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Andreas Schreyer, Founder and Editor of The Green Investor and the Investoblog, is a longtime investor and student of the markets and has been a financial newsletter editor since 2003. He continues as a partner at Fraser Partners and at MarketTrend Advisors, a full service investment advisory... More
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  • LXU Gets the Index Boost 0 comments
    May 13, 2010 11:22 AM | about stocks: LXU
    Standard & Poor’s announced today that LSB Industries Inc. (NYSE:LXU) will be added to the S&P SmallCap 600 index, and the shares jumped nearly 10% on the news, making the stock one of the top daily gainers on the New York Stock Exchange today.
    New index listing invariably raises the age-old question “Is getting listed on a major stock index good for a company or bad?” The answer is: good. The Index Effect exists, it is positive (the median excess return of S&P 500 additions was 3.8% for the past five years). Read “The Shrinking Index Effect” at Standard & Poor’s for the details of the study.
    For us investors in alternative energy stocks, the inclusion of LSB Industries in the prestigious small cap index comes as a confirmation that the geothermal heating and cooling market segment is gaining importance, but also that LSB Industries is a recognized leader in the field. Regardless of any lasting Index Effect on the share price, we like what our analysis of the company fundamentals reveals, and technical indicators make LXU a screaming buy.

    Disclosure: No positions
    Stocks: LXU
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