Shares of Hammerhead Energy (NASDAQ:HHRS) are trending on Wednesday. That’s as HHRS stock climbed 32% at one point during the session. At the last check, shares were up over 7% for the day.
The rally comes amid a mixed day on Wall Street. As the S&P 500 tries to find its footing, it’s hoping to avoid its fourth straight weekly decline.
In the case of Hammerhead Energy — and its special-acquisition company (SPAC) Decarbonization Plus Acquisition — investors are not worried about the overall market’s direction. At least not today. Instead, they are bidding HHRS stock higher as the company closed its SPAC merger and recently began trading under its new ticker symbol.
The deal came together in September and was approved by shareholders in late January. Then, the deal closed on Feb. 23 with plans for HHRS stock to begin trading on Feb. 27. The company is listed on U.S. and Canadian exchanges.
As such, it’s unsurprising that there has been volatile price action over the past few days. That’s as investors jump in on the excitement of the new listing and as others take profit. Of course, there’s also some momentum trading taking place.
What’s the Deal With HHRS Stock Now?
Hammerhead Energy is a Canadian oil and gas operator, now commanding a market capitalization of roughly $1.1 billion. According to the company:
“We are advancing a growth-oriented strategy focused on leading, large scale resource development in the Alberta Montney, one of North America’s highest return plays. Our operations target the responsible development of multi-zone, light-oil rich opportunities, supported by a culture of excellence and strong alignment with integrated environment, social and governance (“ESG”) principles.”
Regarding its ESG principles, it actually had an interesting partner on the SPAC deal.
Per the Wall Street Journal: “The company merged with a climate-focused SPAC launched by energy investment firm Riverstone and says it is focused on carbon-capture and storage to lower emissions from its operations.”
There’s also likely a lot of excitement surrounding the deal due to energy. While natural gas prices have been plummeting, and despite oil prices being well off the highs, there has been a lot of hope surrounding this group.
That’s because energy stocks have been the best-performing sector over the last 12 months. Further, there is optimism that natural gas prices have bottomed and that oil prices could rally. While that enthusiasm may be limited to energy investors, it’s clear why HHRS stock would benefit in that scenario.
If energy prices and energy stocks can go on a sustained rally, HHRS stock could go for the ride as well.
On the date of publication, Bret Kenwell did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.