Below is a note from CEO Keith McCullough on why we're adding Mammoth Energy Services (TUSK) to the short side of Investing Ideas today:
|
Our All Star short-selling Energy Team's latest Best Idea (Institutional Research Product) on the short side is Mammoth Energy Services (TUSK). It's signaling immediate-term #overbought this morning. Per Director of Energy Research, Al Richards, Mammoth Energy Services (TUSK) is a small cap oilfield services company that has recently been awarded a highly-profitable yet controversial $945 million contract from Puerto Rico’s bankrupt, state-owned utility to repair the damaged grid in the wake of Hurricane Maria. Since first announcing the contract and its foray into electrical T&D work on October 19, 2017, TUSK’s stock price is up close to 130% while the oilfield services index (OIH) is about flat. TUSK’s market cap has increased by more than $800MM over that time. In our view, the market’s optimism over this contract and new line of business for TUSK has gotten out of hand, far overestimating the true value added and underestimating the risks associated with the Puerto Rico contract. Sell Green, KM |
