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 Midstates Petroleum (NASDAQOTH:MPOYQ) are trading over 11% higher today following news that the company might be seeking a buyer.

So what: Bloomberg reported this morning that Midstates is working with investment banks Morgan Stanley and Goldman Sachs to solicit offers for its assets. This news comes days after Midstates reported a loss of $84 million for the first quarter, and less than two months after former CEO John Crum resigned.

Midstates' shares have lost over 60% since the company went public in early 2012. The company has plowed over $2 billion into exploration activities since 2010, with less than half that money flowing back in revenue. This caused debt to balloon from less than $100 million in 2010 to $1.7 billion today.

The company's first-quarter report showed a big year-over-year uptick in average daily production to 29,000 barrels of oil equivalent, or BOE, per day, which brought in roughly $64 per BOE based on the company's reported sales of $167.1 million for the period. Midstates also reported about 750 gross active producing wells at the end of the quarter.

Now what: Any buyer would probably have to take on the company's debt, which would push the total sale price past $2 billion. It would also be faced with the fact that while Midstates' production is up year over year, it is sequentially lower in all three of the company's major operating regions, with average BOE production per day from 2013's fourth quarter down 18% in the Gulf Coast and down 7% in the Mississippian Lime. Midstates' red flags will almost certainly prevent many investors from recouping their initial investments, and the upside from this point is likely to be limited, even if a generous buyer can be found.