While insider buying is typically slower when markets are near all-time highs and when earnings-reporting season is in full swing, it never seems to dry up altogether. A few notable purchases in the past week or so attest to this. A beneficial owner took advantage of a public offer to increase a stake in a gold and silver miner, while another showed some love for a struggling offshore driller. The chief executives of a biotech also continued acquiring shares.
Let’s take a quick look at these notable transactions in the past week or so.
What does insider buying tell us?
A well-known adage reminds us that corporate insiders and 10% owners really only buy shares of a company because they believe the stock price will rise and they want to profit from it. Thus, insider buying can be an encouraging signal for potential investors. This is all the more so during times of uncertainty in the markets, and even when markets are near all-time highs.
With the third-quarter earnings-reporting season underway, many insiders are prohibited from buying or selling shares. Below are some of the most notable insider purchases that were reported recently, starting with the largest and most prominent.
Buyer(s): 10% owner Eric Sprott
Total shares: almost 7.7 million
Price per share: $6.50
Total cost: nearly $50.0 million
This transaction was part of a public offering of Hycroft Mining Holding Corp. (NASDAQ: HYMC) stock that raised approximately $150 million. The Nevada-based miner subsequently announced that it had extinguished all its remaining debt.
The stock is almost 88% higher than 90 days ago and was last seen trading almost a dollar per share higher than the buyer’s purchase price. The share price is up 167.6% year over year. The stock has little analyst coverage and no Buy ratings. Yet, the consensus price target is up at $13.61.
Note that this Canadian billionaire previously purchased $62 million worth of the shares this summer.
Buyer(s): 10% owner Pilgrim Global ICAV
Total shares: more than 982,600
Price per share: $14.18 to $15.82
Total cost: less than $14.8 million
Sable Offshore Corp. (NYSE: SOC) stock recently sank to a 52-week low below $12 as the Houston-based company faces multiple legal and regulatory issues. Shares were last seen trading well below the purchase price range above.
The offshore oil and gas field operations provider has a mean price target of $39.20, which would be a gain of 207.9% in the next 12 months. All five analysts who cover the stock recommend buying shares. Roth Capital recently reiterated its Buy rating.
