Ahead of the holiday weekend (and the end of the year), Berkshire Hathaway made another big buy of the Oracle of Omaha’s favorite oil and gas exploration and production company. The past week’s other most notable insider purchase was in shares of a leading discount variety store operator.
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.
Remember that when the earnings-reporting season is in full swing, many insiders are prohibited from buying or selling shares. Below are some of the more notable insider purchases that were reported in the past week.
Occidental Petroleum
- Buyer(s): 10% owner Berkshire Hathaway
- Total shares: almost 5.2 million
- Price per share: $58.89 to $61.06
- Total cost: nearly $312.1 million
After the prior week’s almost $590 million purchase, Buffett bolstered the Occidental Petroleum Corp. (NYSE: OXY | OXY Price Prediction) stake even further this past week to a total of over 243.7 million shares. That is about 28%. Shares are up more than 5% in the past week to just above the top of Buffett’s latest purchase price range. However, they are still in the red year to date. The $69.19 consensus price target suggests around 12% further upside potential.
Dollar Tree
- Buyer(s): director
- Total shares: more than 738,800
- Price per share: $132.26 to $135.72
- Total cost: almost $99.2 million
This indirect purchase of Dollar Tree Inc. (NASDAQ: DLTR) stock lifted the director’s stake to more than 12.1 million shares. Despite a disappointing third-quarter report and a cyberattack, the share price is up around 29% in the past 90 days and was last seen a bit higher than the top of the director’s purchase price range. The S&P 500 hundred is about 10% higher in that time. The $148.61 consensus price target indicates that analysts currently see about 9% more upside in the next year.
Verrica Pharmaceuticals
- Buyer(s): 10% owner Perceptive Advisors
- Total shares: more than 1.2 million
- Price per share: $5.06 to $6.16
- Total cost: over $6.9 million
A partner of dermatology therapeutics company Verrica Pharmaceuticals Inc. (NASDAQ: VRCA) recently announced positive Phase 3 trial results. Shares are up more than 74% since then, well above the buyer’s purchase price range, yet also well below the 52-week high of $8.69. The consensus price target is all the way up at $12.83, and each of the three analysts who follow the stock recommends buying shares.
Intercorp Financial Services
- Buyer(s): 10% owner Intercorp Peru
- Total shares: less than 321,500
- Price per share: $20
- Total cost: over $6.4 million
This buyer is the parent company of Intercorp Financial Services Inc. (NYSE: IFS), a Peruvian bank and insurer. Its stake is 816,000 or so shares. Note that the buyer also picked up more than 482,000 shares, at the same price, in November, following the third-quarter results. Shares are up more than 15% since then, outperforming the S&P 500 in that time.
Ocular Therapeutix
- Buyer(s): 10% owner Summer Road
- Total shares: more than 1.5 million
- Price per share: $3.25
- Total cost: just shy of $5.0 million
This buyer, a Florida-based investment manager, took advantage of a public offering of stock to make easily its largest of several purchases in the past year. Ocular Therapeutix Inc. (NASDAQ: OCUL) announced positive 3 trial results in October and third-quarter results in November. The share price is more than 31% higher than at the beginning of October and was last seen above $4. The consensus price target is all the way up at $15.33.
Globalstar
- Buyer(s): director
- Total shares: 750,000
- Price per share: $1.65 to $1.70
- Total cost: over $1.2 million
Note that a couple of executives recently sold some shares of this Louisiana-based satellite services provider and Apple partner as well. Furthermore, this particular director parted with over 5 million shares of Globalstar Inc. (NYSE: GSAT) back in September. The share price is almost 24% higher since then and hit a new 52-week high of $1.91 this past week.
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