Why Shares of Swift Energy Company 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 Swift Energy Company (NYSE: SFY  ) jumped as much as 16.5% early in trading this morning after it updated operational and financial guidance.

So what: Management said it expects to receive about $150 million in cash when it closes its joint venture with Saka Energi Indonesia on June 30, something investors were looking for when the stock dropped last week. The money will be used to reduce debt and increase capital expenditures by $50 million to $350 million-$400 million.  

As a result of the additional drilling, production is now expected to be between 11.5 million barrels of oil equivalent (MMboe) and 11.8 MMboe, raising the lower end of the range by 0.2 MMboe.

Now what: There was some relief to hear details about the joint venture, and I think investors were looking for some lost revenue and profits once the deal closed, but an increase in drilling activity should make up the difference. So, estimates may be much lower than results will show in the second half of the year. I think Swift Energy has strong momentum after a first-quarter earnings beat, and with the joint venture, it's managed to increase production and reduce leverage, which is good for investors long-term.

3 stock picks to ride America's energy bonanza
Record oil and natural gas production is revolutionizing the United States' energy position. Finding the right plays while historic amounts of capital expenditures are flooding the industry will pad your investment nest egg. For this reason, the Motley Fool is offering a look at three energy companies using a small IRS "loophole" to help line investor pockets. Learn this strategy, and the energy companies taking advantage, in our special report "The IRS Is Daring You to Make This Energy Investment." Don't miss out on this timely opportunity; click here to access your report -- it's absolutely free. 

Read/Post Comments (0) | Recommend This Article (0)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2945640, ~/Articles/ArticleHandler.aspx, 8/31/2015 8:13:17 PM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Travis Hoium

Travis Hoium has been writing for since July 2010 and covers the solar industry, renewable energy, and gaming stocks among other things.

Today's Market

updated Moments ago Sponsored by:
DOW 16,528.03 -114.98 -0.69%
S&P 500 1,972.18 -16.69 -0.84%
NASD 4,776.51 -51.82 -1.07%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

8/31/2015 4:00 PM
SFY $0.60 Up +0.07 +13.58%
Swift Energy Compa… CAPS Rating: **