Lucas Energy, Inc. (NYSE: LEI)
Lucas Energy, Inc. (LEI) an independent oil and gas company announced the acquisition of multiple properties and undeveloped acreage from over 21 different entities. “The assets being acquired include varied interests in two largely contiguous acreage blocks in the liquids-rich Mid-Continent region.” (PR Newswire) Most of the property is from the Hunton formation which is over 43,000 gross acres in Oklahoma. In addition the company announced that they will re-brand themselves and change their name to Camber Energy Inc. following the close of the transaction. As of early Thursday afternoon, stock prices have shot up over 400% due to the acquisition news.
Lucas Energy, Inc. CEO’s Comments
“The completion of this transaction will raise the trajectory of opportunities for Lucas, not only as we increase our existing production base and future development opportunities, but also as we expand our reach into a key play in the Mid-continent and broaden our strategic horizons,” said Anthony C. Schnur, Lucas’s Chief Executive Officer. “We are extremely excited to have identified an acquisition that provides us with stable, long-lived reserves with substantial current production and ample drilling opportunities that are economic in a prolonged depressed commodity price environment. We are further encouraged by the planned upcoming additions to our board, especially the appointment of Richard N. Azar II as our Chairman. I have known Richard over the last three years, and I welcome his depth of knowledge and strategic sense to our Company.” PR Newswire
LEI Technical Analysis
LEI gapped up in price on Thursday to $1.85, up from the prior day’s close of $1.65, which is a 12% increase on favorable news. Taking a look at the daily chart, we can see the last time LEI traded above this price level was on December 21st when it traded at $1.99. LEI shot up to highs of $10.65, equivalent to a 545% move up as of early afternoon trading on Thursday. This puts LEI near its 52-week high price of $11.25. It will be interesting to see if this impressive move up can break thru the 52 week highs or are we looking at a late afternoon fade. LEI has a low float of 944.82 thousand shares and is trading over 677 times the normal daily trading volume. For trading purposes, I would be very cautious at these levels as this move up may be overextended right now. For anyone thinking about shorting, I would also advise extreme caution as the float for the stock is extremely low and it does not take much volume to move the stock up even more.
Lucas Energy, Inc. operates as an independent oil and gas company in the United States. It engages in the acquisition and development of crude oil and natural gas from various formations, including the Austin Chalk and Eagle Ford formations, primarily in Gonzales and Wilson Counties, South Texas; and the Eaglebine, Buda, and Glen Rose formations in Leon County north of the city of Houston, Texas. As of March 31, 2015, the company had estimated net proved reserves 5.1 million barrels of oil equivalent comprising 4.6 million barrels of crude oil reserves and 3.0 billion cubic feet of natural gas reserves. Lucas Energy, Inc. is headquartered in Houston, Texas. Yahoo Finance