Why Shares of Goodrich Petroleum Corporation Popped Today
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 Goodrich Petroleum Corporation jumped as much as 39.5% today after the company announced drilling results.
So what: Goodrich's Blades 33H-1 well in Tangipahoa Parish, La., achieved a 24-hour average production rate of 1,270 barrels of oil equivalent, including 1,250 barrels of oil. The company owns a 66.7% working interest in the well and is part of a large bet on the Tuscaloosa Marine Shale play.
Now what: One of the drivers of the stock today is a short squeeze, which happens when lots of investors who have bet against the stock suddenly rush to buy and close their positions. At the end of March, 59.5% of the float was sold short, so when good news like this comes out, investors rush to the exit. While the news is great, I'd be careful betting too big one way or the other because the buying was driven by short-sellers today, and that may stop later this week, which can make for a volatile stock.
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The article Why Shares of Goodrich Petroleum Corporation Popped Today originally appeared on Fool.com.Travis Hoium and The Motley Fool have no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools don't 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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