Remember Spark Energy Earnings Release

According to the Spark Energy (NASDAQ:SPKE) website the company should announce earnings late Thursday or early Friday and I wanted to make sure investors were positioned correctly for the release in case of ‘surprises’.

Recall that Spark announced earnings which were not well received by investors last quarter and shares of the Spark Energy 8.75% fixed to floating rate preferred shares fell sharply as shown on the chart below.



The company has given no forewarning of poor earnings and has declared both preferred and common dividends for next quarter already on 7/19.

We do note that the common shares fell by 8% today although the preferred shares closed at $23.77–up 7 cents.

As we had previously conveyed we had owned a very large position in the preferred shares (NASDAQ:SPKEP) which we cut back to normal weighting when we were able to exit some shares with a 3-4% profit.

In our opinion investors should not be overweight these preferreds going into the earnings as any upside to preferred price is likely extremely limited–but downside could be great if there are negative surprises.

 

4 thoughts on “Remember Spark Energy Earnings Release”

  1. If they report good results the common should really rocket higher since the Short Percent of Float is 42% which sounds extreme. I’ll be on the sidelines watching the action since I’m out of SPKEP with a tiny profit.

  2. Tim this is why I enjoy your commentary. You can own a slug of KYN-F and then own a WTH issue like that…..As I am the exact same way except with different names attached to them, lol.

    1. Very interesting movement today in Spark: The 8.75% coupon preferred traded almost double the average volume and closed up 0.07 at $23.77 to have a current yield of 9.20% (!), with the next EX date not until 9/28. The common SPKE closed at a new 52 week low at $8.55 on almost 4 times the average volume to yield 8.48% and will go EX 8/28. Betty Davis said “fasten your seatbelt’s. It’s going to be a bumpy night”…Stay Tuned, Nomad

  3. I had a trailing stop loss on my SPKEP which triggered while back, all my holdings have % trailing stops for some protection

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