John Lindsay, President and CEO of Helmerich & Payne (HP), recently bought 20,000 shares. The buy increased his stake by 3%, and came to a total cost of $551,000.
He was joined by a company director, who bought 37,356 shares for a hefty $1.01 million, increasing his position by a massive 217%. The company CFO bought 3,300 shares last year, starting a new position at a cost of just over $99,000. Otherwise, insiders have previously been sellers.
Overall, Helmerich & Payne insiders own 3.6% of shares.
The drilling rig contractor is down 31% over the past year. Energy prices have been lackluster, and operationally the company’s performance has been flat.
Revenues are up a scant 5%, but earnings growth declined by 3%. Still, with the negativity in the sector, HP trades at less than 9 times earnings.
Shares may see better returns amid a renewed push to increase oil production in the United States, but that trend will take time to play out.
Action to take: Helmerich & Payne shares just broke to a new 52-week low, so interested investors may want to wait for a sign that the downtrend is over before buying. Shares currently pay a 3% dividend, which is well covered by earnings.
For traders, the September $30 calls, last trading for about $2.15, could see mid-double-digit returns on rising oil prices over the next five 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.