On Wednesday, two insders at Magnum Hunter Resources Corp (NYSE:MHR) acquired stock from the company. C Gary Evans, Chairman and Chief Executive Officer, bought 30,000 shares: 5,000 of them for $6.06 each, and 25,000 of them, for $6.09 per share. He now holds more than 4.95 million shares, valued at roughly $31.79 million, plus 134,164 shares held indirectly.
L Joe Mcclaugherty, Director of the Board, also purchased stock of the oil and gas exploration small-cap company on Dec. 11th. He acquired 20,000 shares, and paid $6.06 per share for the first 9,900; and $6.08 per share for the remaining 10,100. His holdings now amount to 915,093 shares, worth $5.87 million.
The transactions occurred on the same date that Magnum Hunter Resources Corp (NYSE:MHR) filed an 8-K form at the U.S. Securities and Exchange Commission announcing an Option Agreement with Pathfinder Onshore Energy Pty Ltd, “a privately held Australian company, granting Pathfinder or its nominee, a subsidiary of New Standard Energy Limited (“NSE”), an Australian Securities Exchange-listed Australian company, an option to acquire Magnum Hunter’s remaining oil and gas properties and related assets in the Eagle Ford Shale in South Texas” (Form 8-K).
However, the purchases did anticipate one important decision that was made public on Thursday, after their purchases: Magnum Hunter Resources Corp (NYSE:MHR)’s Board of Directors approved a capital expenditure budget of $400 million for 2014. In fact, the market reacted quickly to this news, and the stock closed up 5.25% on Thursday’s trading, already providing upside for the insiders who had acquired the stock on Wednesday (interpretation is open related to this matter).
In addition to its CEO and one of its Board Directors, other investors are placing big bets on the company. Robert Henry Lynch’s Aristeia Capital holds 9.3 million shares of Magnum Hunter Resources Corp (NYSE:MHR), valued at more than $57 million. This makes it the largest hedge fund bull, both for the number of shares that it holds and for the percentage of its portfolio allocated to this stock (3.65%).
Among other prominent investors, I would like to highlight Gregory Fraser, Rudolph Kluiber, and Timothy Krochuk‘s Grt Capital Partners, which upped its stakes by 27% over the past quarter, and now holds more than 3 million shares. Finally, there’s George Soros, who owns 2.45 million shares of the company.
So, as bullish sentiment increases from both insiders and hedge funds, should you buy Magnum Hunter Resources Corp (NYSE:MHR)?
Disclosure: Javier Hasse holds no position in any stocks mentioned