Today, shares of 88 Energy Limited (OTCMKTS:EEENF) are on the move. Penny stock investors appear to be intrigued by the upside EEENF stock provides at these levels. Shares are up 36% to $0.0228 at the time of writing.
Since spiking as high as 20 cents per share in early March, EEENF stock has been on a steady decline. Shares have dipped nearly 90% from this peak amid operational difficulties.
As fellow InvestorPlace contributor Robert Lakin reported, the company’s update earlier this month indicated some real problems for 88 Energy. Of note, a power outage tied to equipment failure prevented sampling of the two most prospective zones 88 Energy has been pursuing in its Alaskan Peregrine project.
However, today, a better operational update was provided. Let’s dive into what the company announced, and why investors are getting bullish once again on this stock.
Operational Update Provides Tailwinds for EEENF Stock
Today, 88 Energy announced much better operational results from its drilling efforts in Alaska.
In particular, the company reported it’s commencing testing on sidewall cores, cuttings, mud gas and fluid samples from one of its high-prospect zones. 88 Energy reported that results should be expected within two to 10 weeks.
Additionally, some initial mapping of the prospective zones in Merlin-1 were reported to be encouraging. Other acreage 88 Energy is working on appears to have positive implications as well.
A timeline on when investors can expect to see just how good these prospective areas are appears to be something investors and speculators like. As with any exploration stock, EEENF stock remains a highly speculative play. The scope and scale of the discoveries such companies make often determine their share price. Accordingly, lots of volatility can be expected with such stocks.
Today’s operational update has provided a nice swing to the upside. However, investors should remember that this stock’s trajectory over the past couple months hasn’t been great.
Social media-related buying appears to be playing a role in EEENF stock right now. As with any hot stock in the Reddit universe, investors can expect lots of volatility on the horizon.
Which direction this stock goes is anyone’s guess. However, those putting money to work in such penny stocks ought to remember to do so in a prudent fashion. Diversifying one’s bets and ensuring proper position sizing is extremely important with these plays.
On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article.