Why Harvest Natural's Shares Jumped Temporarily
Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of Harvest Natural Resources jumped 10% briefly today on news that an asset sale is likely to go through. The pop didn't last long, but shares did end the day up 3%.
So what: The oil minister of Venezuela said the country will approve a $725 million sale of assets to Pertamina Persero PT once some reserve issues are resolved. Venezuela says it owns some of the assets included in the sale and would need to be compensated for these reserves.
Now what: This brings the deal one step closer to reality, a big positive for Harvest Natural. The company could certainly use the boost to a balance sheet that's slowly running out of cash. If approvals aren't reached by March 22, the deal could still fall through, but it looks very likely today. I think this will move shares higher long term, but it clearly wasn't the big bump some investors thought it was today.
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The article Why Harvest Natural's Shares Jumped Temporarily originally appeared on Fool.com.Fool contributor Travis Hoium has no position in any stocks mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings or follow his CAPS picks at TMFFlushDraw. The Motley Fool owns shares of Harvest Natural Resources. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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