NextDecade Stock Gaps Higher Ahead of "Major Announcement"

A newly disclosed hedge fund stake has EXP breaking out above trendline resistance

Managing Editor
Mar 29, 2019 at 2:57 PM
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The Dow is up triple digits this afternoon on U.S.-China trade talk optimism. Among the stocks making big moves higher today are construction name Eagle Materials Inc (NYSE:EXP), entertainment stock Chicken Soup For The Soul Entertainment Inc (NASDAQ:CSSE), and energy concern NextDecade Corp (NASDAQ:NEXT). Below, we'll take a closer look at the shares of EXP, CSSE, and NEXT.

EXP Scales NYSE on Sachem Head Stake

Eagle Materials stock is up 13.6% to trade at $83.32, one of the best stocks on the New York Stock Exchange (NYSE) today, after hedge fund Sachem Head Capital Management disclosed a 9% stake in the company. In an SEC filing, Sachem called EXP shares "undervalued," and cited plans to "engage in discussions" with the board and management regarding EXP's strategy going forward.

On the charts, EXP has now broken out above a trendline connecting its series of lower highs going back to last June. The shares are also poised to topple their 200-day moving average on a daily closing basis for the first time since late July. 

EXP's usually quiet options pits have come to life today. At last check, over 3,500 calls have changed hands -- five times the average intraday amount, and nearly six times the number of puts traded. Leading the charge is the newly in-the-money April 82.50 call, where new positions are being opened. 

CSSE Eyes Best Day Ever on Sony Crackle Deal

This morning, Chicken Soup for the Soul Entertainment announced a deal with Sony Pictures to form video streaming service Crackle Plus. CSSE will be the majority stakeholder of the joint venture, which is expected to have a combined audience of nearly 10 million monthly active users.  In response, CSSE is up 17.5% to trade at $10.65, after earlier nabbing a fresh all-time high of $11.99. The equity is on track for its best day ever, and extends its 12-month lead to 58.2%. 

It seems analysts have been bracing for such a meteoric rise. All three of the brokerages covering CSSE rate it a "buy" or better, and its consensus 12-month price target of $19.50 is an 83.1% premium to its current perch.

NEXT Analysts Could Shift Stance

One of the better stocks on the Nasdaq today is NextDecade, up 15.6% to trade at $5.85. The liquefied natural gas (LNG) company teased a "major announcement" next Tuesday at LNG2019 in Shanghai -- one that Cowen suspects will be the signing of a new customer.

NEXT has now gained nearly 86% from its mid-February lows at $3.15, and is on track to extend its winning streak to an impressive seven days. The shares are about to take out their 200-day moving average, too, for the first time on a daily closing basis since late August.

Unlike CSSE, NextDecade stock could certainly benefit from a shift in analyst sentiment. All seven of the brokerages tracking the stock rate NEXT either a "hold" or "strong sell," and its average 12-month price target of $5.57 is a discount to its current perch. 

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