Hercules Offshore Pops, Shanda Plops

I mentioned Hercules Offshore back on March 19. On that day, the stock was up 20 percent and I was sitting on a gain of 40 percent total in my Marketocracy Best of Funds. HERO is up another 20 percent today and the position in the Best of Funds has a 75 percent gain. It was a small position initially and has grown to about a half-position size. The previous gain came just after the Federal Reserve announced its quantitative easing policy, but today's move is probably a combination of optimism and $50 oil—a quick check of the energy ETFs shows most of them up more than 2 percent versus 0.5 percent for the S&P 500 Index.

Investopedia has a blurb on oil services today, including Hercules Offshore:

With the focus on deep water drilling, the shallow Gulf of Mexico seems to have been forgotten. The mature fields are often seen as secondary to faster growing deposits in deeper colder water. Combine that with increasing hurricane risk, low oil prices and a debt load of just north of $1 billion and you can see how Hercules Offshore (Nasdaq:HERO) has been struggling as of late. The company has the distinction of being the largest operator of jackup drilling equipment in the Gulf, and the main liftboat operator worldwide. In order to repay debt, Hercules began cold-stacking some of its rigs, including six jackups, three submersibles and 10 barges. The driller has also reduced head count by 25% since November and is planning on selling some older, obsolete driller rigs in order to raise cash. If these cost cutting measures work, Hercules may once again hit its highs

Long-term the stock could go a lot higher——it was as high as $39 in the past year, compared to $3 today. In the short-term, however, a significant pullback would not be surprising. A drop of 50 percent from these levels would still leave HERO 50 percent above its 52-week low.

Shanda (SNDA) fell 11 percent today, down to $47.76. It moved more than 10 percent three times this week, and 7 and 8 percent the other two days. The9 (NCTY) jumped almost 20 percent today after suffering huge losses the previous two days, and it's still 19 percent below Tuesday's close.

More Chinese Gaming News

It's been a volatile week for these stocks, and big news came yesterday when The9 lost its bid to renew the license to operate World of Warcraft. Netease won the right to operate the game for the next three years after the current contract expires. Here's a comparison of the two, plus Shanda, over the past three months.

Shanda Hits All-Time Intraday High

Shanda Interactive (SNDA), a stock I've owned since 2004, just hit a new all-time intraday high at close to $46 per share. The last time it traded that high was late December 2004 and early January 2005. The stock has gone on a tear this year, up about 35%—similar to the mainland market, though they have not traded in tandem.

There's a lot of interest in Chinese internet gaming stocks, with Sohu.com's (SOHU) spin-off of Changyou (CYOU).

At least as of 1 PM, Shanda's 7% intraday move was not replicated by its competitors. The9 (NCTY) was down 6.62% as of this writing.

Update: Shanda closed at an all-time high. It finished the day up 5.7% to $45.07, on double the 3-month average volume.