The presence of activist investors in a company can often lead to a fair degree of uncertainty for investors but last week the CytoDyn Inc (OTCMKTS:CYDY) stock actually performed strongly.
There was no news about the biopharmaceutical company last week but the stock performed strongly. On Friday, it jumped by 5% and ended the week with gains of as much as 12.50%. In this situation, it might be a good move to take a look at a key development from back on August 5. At the time, the company announced that it filed a lawsuit against the activist consortium headed by Bruce Patterson and Paul Rosenbaum at the United States District Court for the District of Delaware.
That was a significant development for the company and it is possible that investors saw it as a show of strength from CytoDyn. In the lawsuit, the company has sought the intervention of the court for stopping the group from disseminating misleading information to the CytoDyn shareholders. In addition to that, the company has also sought intervention from the court with regards to a proxy contest that is allegedly being conducted by the activist group for taking over control of the CytoDyn board.