Digging Into Two Energy Stocks That Insiders Seem to Love

Since tracking insider trading can provide some interesting ideas and might also offer some investment opportunities, let’s take a look into two companies in the energy segment, which have seen insiders buy their stock over the past couple of days.

The first company I would like to refer to is Plains GP Holdings LP (NYSE:PAGP), a $3.7 billion market cap that, through its general partner Plains All American Pipeline, L.P.(NYSE:PAA), is engaged in the transportation, storage, terminalling and marketing of crude oil and refined products. The company was formed to pay dividends on behalf of an oil-and-gas partnership. It went public last October and managed to raise $3 billion in its debut.

Ken Griffin with computers

On March 13th, Victor Burk, Board Director, purchased 3,000 shares of the company for prices ranging from $27.08 per share to $27.09 per share. These are the only holdings that the insider declared in the company, which are valued at approximately $84,000.

Although this company boasts below average margins and returns, and its stock trades at sky-high valuations in relation to the firm´s earnings and book-values, insiders, analysts, and even hedge funds seem to like this stock. Not only are analysts recommending this company, but also, prominent investors have taken big positions in it. For instance, Alec Litowitz and Ross Laser’s Magnetar Capital recently added this stock to its equity portfolio, and currently holds more than 3.5 million shares, worth more than $98 million. Other investment gurus with millionaire stakes in the company that are worth mentioning are Phill Gross, Robert Atchinson, Doug Silverman and Ken Griffin.

The other company in this list is a much smaller one (with a market cap that slightly surpasses $418 million): Swift Energy Company (NYSE:SFY). This Oil & Gas E&P company also witnessed an insider purchase on March 13th. Clyde Smith Jr., Board Director, purchased 15,000 shares of the company at an average price of $9.70 per share. Following the reported transaction, the insider held more than 71,000 shares of the company, valued at more than $681,600.

Once again, negative margins and returns make this stock slightly unattractive. However, the purchase can be understood when one looks at the stock’s valuation, at 0.7 times the company’s sales and 0.4 times its book values (versus respective industry averages of 2.6x and 1.8x). Moreover, decent long-term growth projections and a mean price target of $14.96 per share imply plenty of upside potential for investors. Furthermore, several prominent investors have increased their stakes in the company lately. These are the cases of Chuck Royce, who upped his bets on Swift Energy Company (NYSE:SFY) by 15% over Q4, to 1.26 million shares, and D E Shaw, who boosted his position by 1%, to 137,050 shares.

Disclosure: Javier Hasse holds no position in any stocks mentioned

Recommended Reading:

Bottoms Up: Two Stocks That Insiders Are Chug-a-Lugging

Two Small-Cap Services Stocks That Insiders Love

3 Oil & Gas Stocks That Insiders Love

Comments
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

The 10 Most Expensive iPhone Apps

The 9 Most Expensive Designer Shoes in the World

The 10 Most Expensive Cigarette Brands

The 10 Most Expensive Law Schools in the US

The 10 Best Wall Street Movies

The 10 Most Expensive Golf Clubs Ever Sold

The 10 Most Expensive Golf Memberships

The 10 Best Disney Characters Ever Created

The 8 Best Foods for Gaining Weight

The 10 Most Expensive Colleges in the World

The 7 Most Memorable Ad Campaigns of All Time

The 7 Most Expensive High Schools in the World

The 10 Electric Vehicles with the Longest Range

The 10 Cities with the Worst Drivers in the World

The 10 Most Expensive Dresses Ever Created

10 Islands to Visit Before You Die

10 Famous Celebrities Who Needed Rehab

The 15 Countries with the Largest Oil Reserves

The 10 Most Overused Excuses in the World

The 5 Best iOS Apps You Can’t Get on Android

5 Companies Damaged By Social Media Blunders

The 10 Most Legendary Blues Songs

The 10 Most Lawless Places in the World

4 Reasons China is a Threat to the US

The 17 Most Sugary Drinks in the World

The 10 Most Ruthless Rulers in History

The 10 Greatest Generals in History

Top 8 Travel Destinations for 2015

The 10 Safest Dog Breeds for Children

The 10 Most Stolen Vehicles in the US

The 7 Most Expensive Celebrity Weddings

The 10 Best LoL Teams in the World

Top 10 Worst Marketing Campaigns Ever Produced

Top 5 Diets that Help You Lose Weight

The 10 Best Ways to Stay Awake

7 Artists That Switched Musical Genres

The 10 Most Expensive Cities to Live in New Jersey

The 10 Best High Schools in New York

The 10 Countries With the Least Gender Inequality

The 6 Biggest Musician-Manager Feuds

The 10 Countries with the Cheapest Gas Prices

The 7 Most Theatrical Bands of All Time

The 8 Worst Band Breakups of All Time

The 10 Most Important South American Leaders

The 7 Most Successful Casting Show Winners

The 10 Most Peaceful Countries in the World

5 Big Reasons Communism Failed

The 15 Most Famous Carl Icahn Quotes

10 Scary Animals that are Actually Harmless

The 8 Most Famous Singer-Actors in Entertainment

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!