Shares of Torchlight Energy Rose as Much as 74%
Shares of Torchlight Energy Inc jumped 74% to a record high of $10.88 on Monday as Torchlight Energy became one of the latest companies to grab the attention of retail investors. Torchlight Energy is a high-growth oil and gas Exploration and Production (E&P) company based in Plano, Texas. The company’s main goal is to acquire and develop highly profitable domestic oil fields.
Its shares were recently up 59% at $9.97 with more than 360 million changing hands, making it is the most heavily traded stock in U.S. exchanges. It was Torchlight Energy’s busiest trading day on record.
Last week, the company made an important announcement. Torchlight Energy, which is being bought by industrial materials maker Metamaterial Inc, announced an agreement for sales of up to $100 million of its shares and a special dividend of preferred stock to be issued to shareholders of record as of market close on June 24.
The company was among the most discussed stock on trading-focused social media site Stocktwits. Message volumes on Stocktwits related to the company rose 26%. Most messages were quite positive, with nearly 98% reflecting positive sentiment toward Torchlight Energy’s shares on Monday afternoon.
Torchlight Energy and social media
Social media helped to boost the shares of the company. It is not the only company that benefited from social media platforms. Rallies in video game retailer GameStop as well as AMC Entertainment Holdings in recent weeks helped to reinvigorate a meme stock frenzy that began at the start of the year, fueled in part by retail investors.
GameStop’s shares were recently down around 7% while AMC’s shares declined 5%. Stocks of GameStop and AMC are up 960% and 2560% year-to-date respectively. Torchlight Energy was the second most traded stock on Fidelity on Friday, with buy orders outnumbering sell 1.6-to-1. The stock also had a short interest of 24.7% of freefloat according to analytics company Ortex.
The company said last week it would raise $100 million by selling its shares. Previously other beneficiaries of meme stock rallies such as GameStop and AMC also made similar decisions.
