Richard Mark, a director at Sempra (SRE), recently bought 7,160 shares. The buy increased his stake by a massive 130%, and came to a total cost of $499,840.
Two other company directors also bought shares around the same time, albeit for 1,000 and 700 shares, or about $68,000 and $50,000. Those mark the first insider buys since last May. Otherwise, there have been a few insider sales, including over $4 million in sales from the company’s CEO.
Overall, Sempra insiders own 0.1% of shares.
The gas and electric utility provider is slightly down over the past year, underperforming the overall stock market. Operationally, the company has been mixed, with earnings off by 10%, even though revenues have risen by nearly 8%.
Even with that mixed performance, the utility trades at about 15 times earnings, a fair valuation for a utility company, which tends to offer investors slower growth, but consistent performance.
Action to take: Shares have recently slid heavily following earnings, and may be on track to test their 52-week lows. Long-term investors may want to consider building a small stake here, especially since Sempra pays a safe 3.8% dividend at current prices.
For traders, while shares may look to retest their lows, the stock is also heavily oversold and could be poised to move higher. The July $75 calls, last trading for about $2.15, could see mid-double-digit returns from a bounce in shares over the coming months.
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.