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Why Did Stone Energy (SGY) Stock Soar 23% Today?
On Monday, Stone Energy Cp. continued its recent spree of notable volatility. At opening bell it was quoted at $5.63 and reached a day low of $5.43 while going up as high as $7.47. It closed at $6.77, or 23.32% higher than at opening bell.
This isn’t new behavior for SGY, as our team noted last Wednesday when its shares rose more than 9% on the day. At the time, this was due to the company’s announcement that it would make necessary payments to its lenders in accordance with their financial obligations.
SGY performed a 1-for-10 reverse stock split on June 10th in an attempt to comply with the NYSE’s continued listing standards. Our team believes that this will give the stock another shot at survival.
Although Zacks expects SGY to have a negative EPS, it still maintains a positive Earnings ESP, meaning that there is merit in continuing to hold. Today’s volatility is nothing new and is due largely in part to the volatility in crude prices.
What makes Stone Energy Cp. a solid stock is its high yielding inventory. Although it is subject both to market forces and government action, it continues to remain worth watching.
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