An Insider Bought Shares of Ultra Petroleum

Page 1 of 2

Ultra Petroleum Corp. (NYSE:UPL)’s Controller and vice president Garland Shaw bought 3,000 shares of the company’s stock on March 4th at an average price of $16.20, according to a filing with the SEC. Shaw now owns almost 13,000 shares of Ultra’s stock, so in percentage terms this is a significant increase. Insider purchases are generally considered to be bullish signals, since the insider already earns income from the company and so buying more stock leaves them more exposed to company-specific risks; unless they are particularly confident in the company, the principles of diversification would actually guide towards selling shares.

Revenue was down 24% in 2012 compared to 2011, and this was almost entirely due to lower natural gas revenue. Even after the decline Ultra earns over 80% of its revenue from sales of natural gas, where prices have been in decline due to high production. As a result, even after adding back a large impairment the company’s pretax income fell from about $710 million in 2011 to about $100 million last year. Cash flow from operations also plunged, though because the company slashed capital expenditures operations generated more cash than were used in investing activities- which had not happened in the previous four years.

Still, conditions are poor though we’d generally point to the natural gas market rather than any company-specific factors. Analyst expectations are for $1.18 in EPS for 2013, implying a current-year earnings multiple of 14. From that point they expect net income to increase further. However, the stock has a number of bears with 15% of the outstanding shares being held short.

MILLENNIUM MANAGEMENT

Hedge fund interest in Ultra is moderate. Billionaire Israel Englander’s Millennium Management reduced its holdings of the stock by 78% between October and December, to about 610,000 shares (see Englander’s stock picks). Marathon Asset Management included Ultra Petroleum among its top single-stock holdings at the end of the quarter (find Marathon’s favorite stocks), but it was the only filer in our database of 13F filings which had more than $25 million invested in the company. Hedge fund interest in small-cap stocks such as Ultra can be particularly worth considering, since these stocks often receive less attention from mutual funds and the media and as such can be a rich source of alpha: we have found that the most popular small cap stocks among hedge funds outperform the S&P 500 by an average of 18 percentage points per year.

How does Ultra 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. Our beta is only 1.2 (don't click this link if beating the market isn't important to you).

Lists

Picture Perfect: The 6 Smartphones with the Best Cameras

The 10 Best Countries To Work In the World

A Profitable Day At The Track: 5 Tips For Betting On Horses

Tearing You Apart: 6 Bad Habits That Ruin Relationships

Learning on the Job: The 6 Biggest Mistakes Parents Make

Shopaholics Rejoice: The 12 Biggest Malls in the World

Fright Night: 10 Horror Movies Based on True Stories

Mach Mania: The 10 Fastest Jets in the World

Military Heavyweights: The 10 Countries with the Most Tanks

All In: The 7 Richest Poker Players in the World

Abracadabra: The 10 Best Magicians in the World

The 10 Richest Asian Countries in the World in 2014

Eyes in the Sky: 10 Things You Need to Know About Drones

Rising Stars: The 6 Best Silicon Valley Startups

Military Muscle: The 5 Most Advanced Armies in South America

All that Glitters: The 7 Most Luxurious Jewelry Brands in the World

5 Things You Didn’t Know About ISIS but Should

Empowering Your Money: The 5 Best Energy Stocks to Invest In

The 11 Best Android Apps You Can’t Get on iOS

The 10 Most Important International Conflicts in 2014

Mood Enhancers: The 20 Most Uplifting Songs of all Time

Lover Beware: The 8 Countries that Cheat the Most

Breath of Fresh Air: The 25 Countries with the Best Air Quality on the Planet

Singles Beware: The 8 Worst Mistakes Made on First Dates

Healthy and Happy: The 10 Countries with Lowest Healthcare Costs

The 6 Best Company Team Building Activities to Build Workplace Camaraderie

Ships Ahoy: The 10 Busiest Shipping Ports in the World

10 Productivity Tips to Save You Time and Help You Do More With Less

Grab a Bite: The Most Popular Fast Food Restaurants in America

Friday Night Thirst: The 10 Most Popular Cocktails in the World

The 6 Greatest Unsolved Mysteries We May Never Figure Out

7 Useless Products You Never Should’ve Bought

The 5 Reasons Why You’re Single and Miserable

The 7 Most Addictive Foods in the World We Can’t Stop Eating (Even Though We Should)

5 Amazing Places You Can Swim with Dolphins

The Top 7 Most Livable Countries In The World

The 10 Most Expensive Baseball Cards Ever Pulled From A Pack

The 5 Easiest Second Languages to Learn for English Speakers

Silver Spoon: The 6 Richest Families in the World

The 20 Countries with the Largest Prison Populations in the World

The Top 10 Richest Actors in the World

The 10 Best Airline Stocks to Invest In Before They Fly Too High

Burger Kings: The 10 Most Expensive Burgers in the World

The 10 Most Ethnically Diverse Countries in the World

The 10 Most Exclusive Credit Cards in the World

The 10 Most Expensive Cruise Ships in the World

The 10 Fastest Supercomputers in the World

The 10 Best Countries for Doing Business 2015

6 Most Expensive Fruits In The World

10 Worst Airlines in the World

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!