Srb Corp, a major holder of Safety Insurance Group (SAFT), recently added 32,384 shares. The buy came to a total of $2.17 million, and increased the fund’s position by 2 percent.
Srb has been a regular and consistent buyer of shares since May, with eight buys in the past three months. Going back further, last year saw company insiders, including both directors and officers, sell small parts of their holdings.
Overall, company insiders own 4.2 percent of shares, and institutions such as Srb own about 82 percent of Safety.
The insurance provider has lost money over the past year, even as revenues rose by just under 10 percent. Higher insurance premiums and improving asset valuations have been impacted by higher costs, including the value costs of assets to insure.
Action to take: With shares of the insurer down about 20 percent since the start of the year, there may be a value play here. At present, shares yield about 5.3 percent, but the payout ratio is high, so there may be a dividend cut if earnings don’t improve.
For traders, the August $75 calls have a few weeks to play out. Last going for about $0.35, they could see high-double-digit returns, particularly if shares continue their short-term uptrend going on now.
Disclosure: The author of this article has no position in the companies mentioned here, but may trade after the next 72 hours. The author receives no compensation from any of the companies mentioned in this article.