An Insider Bought 80,000 Shares of Murphy Oil

Page 1 of 2

Murphy Oil Corporation (NYSE:MUR), an integrated oil and gas company, had Board member Claiborne Deming (who was the company’s CEO through 2008) directly purchase 80,000 shares of stock in mid-February at prices of up to about $60.50 per share. Insider purchases tend to be bullish signs (read more about research on insider trading), as the insiders are choosing to buy more stock rather than diversify their investments as would normally be rational. Recently, we have been focusing much of our attention on tracking a new round of 13F filings from hedge funds and other notable investors as part of our work developing investment strategies based on hedge fund activity. On average, the most popular small cap stocks among hedge funds outperform the S&P 500 by 18 percentage points per year (learn more about our small cap strategy). However, the size of this insider purchase makes it worth investigating in our view.

Last quarter, Murphy Oil Corporation experienced a 9% increase in revenue compared to the fourth quarter of 2011. While the company’s expenses were up, pretax income for the quarter grew to over $260 million from a little less than $90 million. This was an improvement compared to earlier in the year, when sales and pretax income had been about flat compared to a year ago. In total, Murphy Oil posted just under $5 per share in earnings for 2012, generating a trailing P/E multiple of 12. We’d note that- as we’ll see when we look at the company’s peers- that while that valuation is low in absolute terms it is not particularly attractive for an oil and gas company in the current environment. Analyst expectations for 2013 imply a current-year P/E of 12 as well, and then a pickup in earnings in the following years (for example, based on consensus for 2014 the forward earnings multiple falls to 10).

THIRD POINT

Billionaire Dan Loeb’s Third Point initiated a position of 4.9 million shares in Murphy Oil Corporation during the third quarter of 2012 (see Loeb’s newest stock picks). Orbis Investment Management, managed by William Gray, has been another major shareholder in the company and that fund reported owning 4.1 million shares at the end of September (check out more stocks Orbis owned). Cliff Asness’s AQR Capital Management had been buying shares during Q3 as well (find Cliff Asness’s favorite stocks).

How does Murphy Oil compare to its peers?

Page 1 of 2
blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months Click to see monthly returns in table format!

Lists

10 Most Influential Papers In Economics

Top 8 Biggest Charities in the US

10 Worst Celebrity Career Moves Ever

Top 10 Best Paid Tennis Stars in the World

10 Cities with High Demand for Nurses

6 of the Worst Greeting Card Messages Ever Crafted

6 Ways to Make Money in ArcheAge and Build Your Empire

10 Foods To Eat To Lower Cholesterol Levels

The 10 Most Hated Television Characters of All Time

The 30 Worst Halloween Costume Ideas Ever Brought to Horrible Life

10 Vocational Skills in Demand Today with Jobs Waiting to be Filled

10 Best Places to Visit in Central and South America

The 10 Greatest Empires in History Which Nearly Conquered the World

The 6 Cheapest Boarding Schools In America 2015

5 Clear Reasons LoL is Better than DotA, Continues to Rule MOBAs

The Only 9 Teams with a Chance to Win the Super Bowl

The 15 Most Common Phobias in America that Induce Fits of Panic

Top 6 Least Expensive Tourist Destinations in 2014

Jim Goetz, Peter Fenton, Jim Breyer: Top 6 Venture Investors for 2014

Top 15 Billionaires in 2014

5 Pitfalls To Avoid When Buying a Franchise

Top 20 Medical Schools in the US – 2014 Rankings

4 Business Strategies that Turned Jamie Oliver into the World’s Richest Chef

6 Qualities That Make You A Good Team Player

10 High Paying Seasonal Jobs in America this Holiday Season

The 10 Busiest Shipping Lanes in the World

5 Most Valuable Brands in China

The 10 States with Highest Substance Abuse Rates Crippling Their Populace

The Top 10 Things to Do Before You Die That Will Echo for Eternity

The 10 Best Selling Items on Etsy

Top 10 Things to Do in Tokyo, the Greatest City in the World

10 Mistakes on Social Media that Can Harm You and Will Probably Get You Canned

The 10 Best Cities to Find Jobs in 2014

The 10 Most Controversial Songs Of All Time to Hit (and get Banned from) the Airwaves

The 20 Biggest IPOs in US History

The 10 Best Places to Visit in Mexico that Are Beautiful and Safe

7 Bad Habits that Age You Beyond Your Years

The 40 Best Fortune Cookie Sayings That Will Leave You Bemused, Befuddled, or Beguiled

10 Foods to Eat Before a Workout to Make Every Drop of Sweat Count

The 5 Best Documentaries On Netflix You Must See

The Most Heartwarming and Inspirational Story Of This Halloween Season, It Will Make You Cry and Jump For Joy

10 Best Party Songs of All Time to Bring the House Down With

5 New World Order Conspiracy Theories that Will Strangle the World

The 10 Highest Rated Movies of 2014

The 10 Largest Container Shipping Companies in the World

The 10 Largest Armies in the World: Who Should We Be Afraid Of?

Best Warren Buffett Quotes on Money You Need to Hear

The 10 Highest Suicide Rates by Profession

The 20 Most Underrated Movies of All Time

The 10 Fastest Growing Companies in America

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!