Why did this ASX 100 stock just crash 11%?

Cleanaway shares have been on a crazy roller-coaster over the past 24 hours.

| More on:
man grimaces next to falling stock graph

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

It's looking like today's stock market session is on track to deliver investors another gain. At the time of writing, the S&P/ASX 200 Index (ASX: XJO) has risen by a rosy 0.45%, pulling the index back over 7,100 points. But one ASX 200 stock – in fact, an ASX 100 stock – is going the other way today.

Cleanaway Waste Management Ltd (ASX: CWY) is the ASX 100 stock in question. And it's seemingly having an awful day.

Cleanaway shares closed at $3.01 each yesterday. But this morning, the waste management company opened at just $2.60 and is currently trading at $2.67 a share, down a nasty 11.3% for the day thus far.

So why is this ASX 100 stock so clearly bucking the market and having such a miserable session this Wednesday?

What's up with the Cleanaway stock price?

Well, to answer that, we need a little more context. So sure, this fall that Cleanaway shares are experiencing today looks dramatic. But it follows an even more unusual move we saw happen yesterday.

Yesterday was a relatively calm day for this ASX 100 stock. At least it was, until a few minutes before market close. These few minutes unexpectedly saw Cleanaway shares rocket around 15% up to a new 52-week high of $3.01, which is where the stock closed at yesterday afternoon.

This morning's plunge just took some of the steam out of yesterday's late pricing surge. Cleanaway shares remain comfortably above where they started the day yesterday.

What on earth is going on with this ASX 100 stock?

Well, some ASX releases put out by Cleanaway shed some light on this rather bizarre situation.

The ASX 100 stock received an ASX speeding ticket yesterday evening for the shenanigans of its share price in the afternoon. In its query, the ASX noted the "change in the price of CWY's securities from $2.65 at 4PM to $3.01 at the completion of the closing auction today".

In its response this morning, Cleanaway blamed the spike on "media speculation regarding a possible takeover offer by Seven Group Holdings Limited".

Seven Group Holdings Ltd (ASX: SVW) is the conglomerate behind several other businesses, including oil and gas, media and heavy equipment.

According to several media outlets, including Bloomberg, Seven "has been seeking financing for a potential takeover of Melbourne-based Cleanaway Waste".

Seven has been silent on this whole affair so far. However, Cleanaway released a supplementary ASX filing this morning, which stated the following:

Cleanaway confirms that it is not in any discussions with SGH in relation to any form of corporate transaction or otherwise, nor has it received an approach or offer from SGH.

So given Cleanaway shares' reluctance to go back to where they were before yesterday's spike today, it looks as though investors remain hopeful that there's something here.

But for now, at least, it looks as though this rather strange chapter in Cleanaway's share price history has closed.

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Share Fallers

A woman with a sad face looks to be receiving bad news on her phone as she holds it in her hands and looks down at it.
Share Fallers

Why Infratil, James Hardie, Sonic Healthcare, and Star Entertainment shares are sinking today

These shares are having a tough session on Tuesday. But why?

Read more »

Male doctor in a lab coat working at laptop looking serious.
Share Fallers

Why this ASX 200 healthcare stock is tumbling 6% today

Inflation pressures are claiming another victim as this healthcare giant lowers its FY24 expectations.

Read more »

A man sits in despair at his computer with his hands either side of his head, staring into the screen with a pained and anguished look on his face, in a home office setting.
Share Fallers

Why Core Lithium, Duratec, Galan Lithium, and Michael Hill shares are sinking today

These shares are starting the week in the red. But why?

Read more »

two men in hard hats and high visibility jackets look together at a laptop screen that one of the men in holding at a mine site.
Share Fallers

Why did the Core Lithium share price just crash 6%?

Investors are bidding down the Core Lithium share price today.

Read more »

A woman with a sad face looks to be receiving bad news on her phone as she holds it in her hands and looks down at it.
Share Fallers

Why Clearview, Loyal Lithium, Polynovo, and Weebit Nano shares are falling

These shares are ending the week deep in the red. But why?

Read more »

A male investor wearing a blue shirt looks off to the side with a miffed look on his face as the share price declines.
Share Fallers

Why IDP Education, JB Hi-Fi, PYC, and Renascor shares are falling today

These shares are missing out on the good times on Thursday. But why?

Read more »

A woman with a sad face looks to be receiving bad news on her phone as she holds it in her hands and looks down at it.
Share Fallers

Why Fletcher Building, Healius, Iperionx, and Iress shares are sinking today

These shares are having a tough time on hump day. But why?

Read more »

A man sits in despair at his computer with his hands either side of his head, staring into the screen with a pained and anguished look on his face, in a home office setting.
Share Fallers

Why Boss Energy, Meteoric Resources, Pantoro, and Worley shares are falling today

These shares are having a tough session today. But why?

Read more »