Why Houston American Energy (HUSA) Stock Is Falling

Houston American Energy Corporation (NASDAQ:HUSA) shares are trading lower by 22% to $1.85 Wednesday morning after the company announced a $4.42 million registered direct offering.

What Else: Houston American Energy on Wednesday morning announced it entered into a definitive agreement to sell 2.6 million shares of its common stock at $1.70 per share in a registered direct offering.

The transaction is expected to generate gross proceeds of approximately $4.42 million, with the closing anticipated on or about January 23, 2025, pending customary conditions.

Univest Securities, LLC is serving as the sole placement agent for the offering.

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Should I Sell My HUSA Stock?

Whether to sell or hold a stock largely depends on an investor's strategy and risk tolerance. Swing traders may sell an outperforming stock to lock in a capital gain, while long-term investors might ride out the turbulence in anticipation of further share price growth.

Similarly, traders willing to minimize losses may sell a stock that falls a certain percentage, while long-term investors may see this as an opportunity to buy more shares at a discounted price.

Shares of Houston American Energy have gained 47.66% year to date. This compares to the average annual return of 16.47%, meaning the stock has outperformed its historical averages. Investors can compare a stock's movement to its historical performance to gauge whether this is a normal movement or a potential trading opportunity.

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HUSA has a 52-week high of $3.20 and a 52-week low of $0.96.