Markets
SD

Here’s Why SandRidge Energy Inc.’s Stock Continues to be Volatile

SD Chart

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: SandRidge Energy Inc.'s stock continues to take investors on a wild ride. It jumped by double-digits as the market opened this morning before fading a bit by midafternoon. Fueling today's volatility is the same thing that has pushed the stock around over the past few months: the price of oil. Crude is up 4% today after word of an agreement to cease fighting in Ukraine, which helped ease concerns over demand for Russian oil. This was enough to rally the price of crude oil and SandRidge Energy's stock.

So what: SandRidge Energy stock was priced over $7 a share last summer before going into a deep slide and bottoming out in January at just over a buck a share. It has now nearly doubled off that low, as it has rebounded along with the price of oil in recent weeks.

SD data by YCharts .

Almost all of the stock's recent movement has been linked to its leverage to oil. The only recent news to move the stock was a report that SandRidge is slashing its rig count by 75% . This move was necessary as the company can't make much money drilling for oil that costs less than $50 per barrel.

Now what: There's not a whole lot SandRidge Energy can do at the moment. Its core drilling area needs sustainably higher oil prices in order to make a decent return on operations. The company will need to do its best to tread water until the price of oil improves just to control its debt, which has already been a huge weight on the stock.

How to invest in the technology fueling the U.S. energy boom

As the price of oil plummets, savvy investors are looking for a way to invest in this new energy dynamic. And there's one high-caliber company in the oil-services sector using advanced technology to profit from the U.S. oil boom. Given the country's ongoing quest to extract more and more oil, I strongly urge you to claim your copy of our brand-new investigative report on this company helping fuel its boom. Simply click here for access .

The article Here's Why SandRidge Energy Inc.'s Stock Continues to be Volatile originally appeared on Fool.com.

Matt DiLallo owns shares of SandRidge Energy. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days . We Fools may not 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 .

Copyright © 1995 - 2015 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

In This Story

SD

Other Topics

Stocks