What happened

Eastman Kodak (NYSE:KODK) stock took investors for a wild ride this past summer.

Rising from $2 and change to as high as $60 in two crazed trading days in July, the stock proceeded to oscillate, first higher, then lower (and lower, and lower) over the next several months, ultimately closing at $7.53 on Friday last week. This morning, Kodak jumped 82% in 9:45 a.m. EST trading on news just published in The Wall Street Journal

Glowing green line climbs on a stock screen.

Image source: Getty Images.

So what

If you recall, Kodak's wild ride began when the Trump Administration offered Kodak a $765 million loan to help it produce chemicals needed to manufacture coronavirus drugs -- and ended when questions began emerging about how kosher that loan was, and whether Kodak insiders might have illegally profited from stock options granted before the loan was announced.

In September, lawyers hired by Kodak cleared the company of wrongdoing -- but a congressional investigation into the matter did not accept those findings, and Congress continued its own investigation, keeping pressure on the stock. On Sunday, however, the Journal reported that the U.S. International Development Finance Corporation, the government agency that originally arranged the loan to Kodak, had just produced a report for Congress finding no "evidence of misconduct on the part of DFC officials" and assuring Congress that "DFC followed its standard process, under its standard timeline," in awarding the contract.

It is this report that investors seem to be reacting to this morning.

Now what

But are they reacting logically? As DFC inspector general Anthony Zakel told Congress over the weekend, "We focused our review on issues within DFC. ... We did not review conduct by Kodak or non-DFC personnel." So this report, while on its face positive, doesn't really clear Kodak of wrongdoing -- and it doesn't seem Congress has wrapped up its investigation yet, either.

Meanwhile, the loan in question, announced nearly five months ago, was never actually awarded to Kodak. Although Kodak CEO Jim Continenza still plans to proceed with manufacturing chemicals for coronavirus drugs, and says Kodak will do this with or without the loan, when you consider that the loan was responsible for lifting Kodak shares about $2 in the first place, it's hard to see why investors think Kodak is worth much more than $2 today in the loan's absence.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.