Rising Oil, Strong Earnings Have Several Energy Stocks Jumping Today

Oil prices have surged by over 3% today as investors are hopeful that an OPEC meeting scheduled for September could lead to a freeze on rising output, which has shackled the crude market in recent weeks. The energy sector is up by 1.6% today on the news, as several energy companies have posted monstrous gains.

We’ll take a look at three of them in this article: Emerge Energy Services LP (NYSE:EMES), Resources Inc. (NYSE:DNR), and Sanchez Energy Corp (NYSE:SN), as well as a couple of other stocks that are heating up the boards during today’s session: Heat Biologics Inc. (NASDAQ:HTBX) and Resonant Inc. (NASDAQ:RESN). In addition to the latest news, we’ll also use SEC filings to judge the latest hedge fund sentiment towards each stock.

At Insider Monkey, we track around 765 hedge funds and institutional investors. Through extensive backtests, we have determined that imitating some of the stocks that these investors are collectively bullish on can help retail investors generate double digits of alpha per year. The key is to focus on the small-cap picks of these funds, which are usually less followed by the broader market and allow for larger price inefficiencies (see more details).

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Emerge Energy Flying High on Flurry of News

Emerge Energy Services LP (NYSE:EMES) has gained 21% today on a trifecta of news consisting of the rising oil prices, the company’s second quarter results released this morning, and the announcement of a $20.00 million private placement of a new class of its limited partner interests. In the latter case, the company will use the proceeds from the sale to pay down some of its debt and for general partnership purchases. For its second quarter, Emerge Energy’s revenue fell to $24.83 million, from $68.12 million a year earlier. That led to an operating income loss of $22.87 million for the quarter, compared to a profit of $3.09 million in the second quarter of 2015. The company sold 399,000 tons of sand during the second quarter.

Emerge Energy Services LP (NYSE:EMES) was not at all popular among the funds in our database during the first quarter, as all four funds that held long positions in the stock on December 31 sold out of those positions by March 31. That appears to have been unwise, as shares have gained 129% this year.

Heat Biologics Heating Up

Shares of nano-cap Heat Biologics Inc. (NASDAQ:HTBX) are up by over 27% today on robust trading volume as the stock continues to build on a big run that began last week. Shares have now gained 121% over the last six trading sessions after being stuck in a narrow range for much of the last four months. After announcing a secondary offering on July 21, the company quickly changed course and announced that it had suspended the offering the following day, saying that it would instead explore strategic alternatives. The biotech company has two cancer drugs in Phase II studies, with the topline data from those trials expected in the fourth quarter. We reported on insider buying at Heat Biologics on March 24, shortly after shares spiked and then subsequently tumbled a few days earlier. Shares have gained 134% since March 24.

We’ll see what’s happening with three other stocks today on the next page.

Resonant Jumps on Licensing Agreement

Resonant Inc. (NASDAQ:RESN) has gained over 10% today after it announced an expanded licensing agreement with one of its Tier One customers. The designer of radio frequency filters announced that as part of the expanded agreement it will develop an integrated module that will include both a duplexer and quadplexer. The agreement with the unnamed customer brings the total number of products in development for that company based on its patented technology and design tools to seven.

We also reported on a massive cluster of insider buying at Resonant Inc. (NASDAQ:RESN) on April 27, which saw a multitude of its Board members and executives buy up shares. Shares of the company have gained 47% since then.

Denbury Pecking Out a Rebound

Back now to some of the day’s energy gainers with a look at Denbury Resources Inc. (NYSE:DNR). Shares of the company are up by 9% today, stemming some of the stock’s bleeding since late-June. Short interest in the company’s stock soared during the second-half of that month and shares quickly dropped in response, falling by 40% between June 21 and August 3. That followed the company selling its remaining assets in the Williston Basin for $58 million on June 20. Denbury announced its second quarter results on August 4, with earnings of $0.08 per share easily beating estimates of $0.02 thanks to effective cost reductions across all categories of the company’s business. Andy Redleaf‘s Whitebox Advisors opened a 1.18-million-share position in Denbury Resources Inc. (NYSE:DNR) during the second quarter.

Sanchez Energy Enjoys Strong Quarter

Sanchez Energy Corp (NYSE:SN) has enjoyed the double whammy of rising oil and a strong earnings report issued this morning, leading to its shares soaring by over 23% today. The company reported an adjusted loss of $0.06 per share for the quarter, beating analysts’ consensus estimate by $0.03. Revenue did widely miss estimates however, coming in at $110.97 million, $15.51 million short of expectations. Nonetheless, revenue was up by 39% quarter-over-quarter, and while other players in the industry are exhibiting caution, Sanchez Energy is showing some aggressiveness, with plans to increase spending on E&P activities by as much as $50 million this year, with the aim of boosting its production by 5%-to-7% next year.

Sanchez Energy Corp (NYSE:SN) was in the portfolios of eight of the hedge funds tracked by Insider Monkey on March 31, with them collectively owning 8.40% of its common stock.

Disclosure: None