Top Short Play: Energy Stock Plummets

Daily Stock Market Summary

Markets came out of the gate today up modestly, and have been slowly losing momentum as the day wears on. It’s not a sharp recovery from steep losses during yesterday’s treading. Volatility continues to be the rule: just when the market seemed to gain confidence after February’s big correction, momentum started slipping again.

Energy shares are supporting the market today, inching upward as producers ratchet back from a global supply glut. Tech shares, meanwhile, are struggling to rebound from yesterday’s hammering. The market is trading on relatively muted volume today as investors await word from the US Federal Reserve tomorrow. Interest rates continue to fluctuate, with the bond market providing no definitive indicators for the direction of the economy.

This sort of unpredictable environment is actually associated with higher average profits for investors employing news-based stock trading approaches. These quantitatively-rooted trading strategies have been milked for profits by big hedge funds for years. In our free weekly training seminars, you can find out how the NewsQuantified platform is making the profits enabled by news-based trading accessible to smaller investors. We’ll take a virtual tour of the platform and discuss some foundational principles for using the news to beat market averages:

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In recent days, we’ve focused on long plays that have surged even as the broader market struggled. But our platform also allows for a diverse array of short plays—perfect for balancing your exposure to risk during any given trading window.

Today’s Top Short Play: Willbros Group (WG)

Energy Stock Tumbles as Financial Situation Grows Dire

WG Stock Plummets

Willbros Group is a specialty contractor focused on providing infrastructure for the energy sector. Based in Houston, they’ve been struggling with major losses on lump sum contracts in recent months.

They hit the markets with multiple negative news events this morning.  First, they announced operating losses around $90 million on revenues around $850 million.

Second, they confirmed that are exploring “strategic alternatives,” including the selloff of all assets, as a solution to their current financial situation. They already sold off a major pipeline operations business unit in January, retaining only the workforce needed to complete current contracts. Their current  cash/credit situation suggests an operational liquidity crunch in the coming year. They are discussing potential sales with various organizations.

Investors have been selling the stock rapidly since we issued our news alert this morning. It sits down over 70% at the time of this writing, leading to nice profits for NQ users how added the stock to their basket of shorts. 

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