The declaration of dividend can often prove to be a major positive for any publicly traded company and on Wednesday, such an announcement from Houston Natural Resources Corp (OTCMKTS:HNRC) led to a rollicking rally in the stock.
On Wednesday, HNRC stock soared 44.54% to $0.43 with 817K shares, compared to its average volume of 272K shares. The stock moved within a range of $0.3010 – 0.4300 after opening trading at $0.72.
The company announced yesterday that all its non-energy assets are going to be spun off into a new fully owned subsidiary unit named Worldwide Diversified Holdings Inc. However, that is not all, the company is then going to provide dividends from the spun-off entity to all Houston Natural Resources Corp shareholders. All shareholders of record as on December 16, 2022, are going to be entitled to the dividends.
The announcement proved to be a major boost to the Houston Natural Resources Corp stock, which ended up with gains of as much as 44.55% yesterday. In addition to that, the trading volume in the stock also went up significantly as investors piled on to it in a big way.
It was announced yesterday that Houston Natural Resources Corp expects the registration statement to be concluded at some point in the fourth quarter of the year. It was further announced that each shareholder in the company is going to be paid dividends to the tune of $1.75 a share for each share of the company that they held.
The transfer of the non-energy assets to a new entity had actually been made effective back on June 30 this year by way of approval from the board of directors at Houston Natural Resources Corp. It should be noted that the board of directors had already gained the approval of the shareholders in the company before making the move. It was a major new announcement made by the company yesterday and it remains to be seen if the Houston Natural Resources Corp can continue to add to its gains.
HNRC stock is trading above the 20-Day and 50-Day Moving averages of $0.34 and $0.38 respectively. Moreover, the stock is trading above the 200-Day moving average of $0.41.