The Dorchester Minerals Operating company, the controlling entity for
Dorchester Minerals LP (DMLP), recently added 9,000 shares. That increased the operating company’s holdings by 54 percent, and came to a total value of around $150,000.
Besides buys from the operating company, a number of insiders, including the CEO, CFO, and COO have been buyers in the past year. The last insider sale occurred in March 2020, and was made by a company director.
Overall, company insiders own about 8.2 percent of shares.
The oil and gas company has been in a general uptrend in the past year, with shares beating the S&P 500 by 12 points. The company has seen big profit margins thanks to rising oil prices.
Action to take: Structured as a partnership, most income passes through to its shareholders. That provides shareholders with a big dividend, about 7.7 percent at today’s prices. The dividend has also been recently increased, but will be volatile depending on the company’s earnings.
For traders, companies with a lower dividend may prove a better play for betting on the price of oil and natural gas. That’s because a company’s share price is lowered automatically when a dividend is paid out. That said, if oil prices are rebounding again, the November $17.50 calls, last going for about $0.75, could deliver high-double-digit returns that beat even the stock’s high yield.
Disclosure: The author of this article has no position in the company mentioned here, but may make a trade after the next 72 hours. The author receives no compensation from any of the companies mentioned in this article.