Jones Energy – Stop Price Adjustment Due to Special Stock Dividend

By Jim Pearce • March 6, 2017

On Friday, Jones Energy (JONE) closed at $3.15, right on the stop price I set for it when it was added to the portfolio two weeks ago (bear in mind I only enforce stop limits at the close since intra-day trading is sometime subject to erroneous and erratic pricing that is usually corrected by the close). However, earlier that day the company announced a special stock dividend that effectively reduces that value to $2.85 based on the extra stock being distributed to existing shareholders. Therefore, I will continue to hold JONE with a revised stop price of $2.85.

I realize this has been a particularly volatile position that thus far has not worked out in our favor, and I am hopeful that this Wednesday evening’s quarterly earnings release will reverse the recent trend in its share price. If not, and JONE closes below $2.85, then I will issue a Sell alert for it at that time.

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Jim Pearce

03/09/17 ‐ 9:40am ET March 9, 2017 at 9:40am ET

The JONE quarterly report released last night (http://finance.yahoo.com/news/jones-energy-inc-announces-2016-230658381.html) was slightly better/less bad than analysts expected, so the stock is up a tad this morning at $2.95 (it briefly traded above $3 in overnight trading). Not a game changer, but should put a floor beneath it that is above our revised stop level unless oil prices take a dive. On the other hand, we still have five months to go in our target holding period, and if we get a bump in oil prices between now and then we could get a nice bump out of JONE.

Karen Williamson

03/09/17 ‐ 11:42am ET March 9, 2017 at 11:42am ET

My stop loss sold my 100 shares! I am concerned Jim….we are not making the money we were promised with this system with the exception of Delphi and kohl’s! What is going on????? I am not seeing the 100% annualized returns on alot of these traed…..time to offer that 2nd year for free……

Jim Pearce

03/09/17 ‐ 11:53am ET March 9, 2017 at 11:53am ET

Actually, we have already delivered several 100%+ returns since this service was launched last August (https://www.investingdaily.com/systematic-wealth/portfolio/dynamic/closed-trades/), and once the year is up we can determine if that guarantee has been met. However, not every trade will be a winner so the key to success is spreading your money around all of the trades evenly rather than loading up on only a few. Getting stopped out of JONE is no fun, but that also prevents a small loss from becoming too big while allowing our winners – such as BBY, CARB, CSCO – to continue to run.

Maria R

03/09/17 ‐ 6:44pm ET March 9, 2017 at 6:44pm ET

I got an email for Wealth Society saying to sell JONE. The closing stock price is 2.85, but I do not see the sell alert on the Systematic Wealth website.

Thank you for the clarification.

Jim Pearce

03/10/17 ‐ 9:41am ET March 10, 2017 at 9:41am ET

I held off on sending out the alert until this morning so that it would not get overlooked yesterday evening (since I execute stops based on closing price only, I had to wait until 4:30 to confirm that JONE did in fact close right on $2.85). But the WESO Confidential email grabs everything that has been entered into our publishing system that day, regardless of when it is scheduled to be posted to the website which is why you saw it there but not here.

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