Bradley Ehrman, CEO of Dorchester Minerals, LP (DMLP), recently bought 2,800 shares. The buy increased his position by 2%, and came to a total cost of $82,600.
This is the sixth insider buy of the year. The company CFO was a buyer of $77,000 worth of shares in May. And the company’s operating LP has been accumulating shares throughout the year. There have been no insider sales over the past two years.
Overall, Dorchester insiders own 7.1% of shares.
The oil and gas exploration company is up about 3% over the past year. While lagging the overall market, that’s about in-line with the rangebound trading in oil prices.
That’s reflected in the company’s financials, with earnings sliding 36% and revenues down 23% over the past year.
However, while earnings are down, Dorchester is highly profitable, with a hefty 68% profit margin.
Action to take: Income investors may like shares of the LP, although an LP may carry different tax requirements than a common stock. At current prices, Dorchester pays out a 10.8% yield.
For traders, shares have been rangebound over the past year, but are at the lower end of their range. The August $30 calls, last trading for about $1.75, are already slightly in-the-money. The options could see mid-double-digit returns in the coming weeks.
Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any company mentioned in this article.