Global GP LLC, the general partner of Global Partners LP (GLP), recently added 4,100 shares to their holdings. The buy increased the GP’s stake by nearly 8 percent, and came to a total cost just over $130,000.
This is the 8th buy from the general partner this year. A company director has also been a recent buyer, picking up 2,000 shares for just over $56,000 back in September. The last insider sale occurred back in May.
Overall, company insiders own 20 percent of shares, with institutions like the general partner owning another 28 percent.
Shares of the gasoline transportation company are up 37 percent in the past year, amid a strong energy market. Revenues are up nearly 40 percent, and earnings have surged by 235 percent. That’s led to a valuation of under 4 times earnings, although as an LP, the real story is in the dividend.
Action to take: Investors may like shares here, as the LP structure means the company pays out a large dividend. At present, shares yield just under 8 percent, and the dividend was slightly increased in the past year. The most recent payout ratio came to 26 percent of earnings, so there’s room for a higher payout in time.
For traders, the March 2023 $35 calls, last going for about $0.90, offer mid-double-digit returns on a move higher for shares in the coming months. As a high-income play, the better returns on this position may come from owning shares.
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 of the companies mentioned in this article.