Joseph Reece, a director at Compass Minerals (CMP), recently added 5,000 shares. The buy increased his position by 13 percent, and came to a total cost of $106,200.
This is the first insider buy since September, when the company’s Chief Commercial Officer bought 3,503 shares, paying just over $94,000. Going back to 2022, company insiders were more active as buyers, including buys from the company President and CEO.
Overall, Compass insiders own 0.9 percent of shares.
The salt and mineral producer has seen shares slide 53 percent over the past year. Revenue is down by 25 percent, and Compass hasn’t been profitable.
The decline in earnings has taken shares to 24 times earnings. And Compass has slashed its dividend from $2.88 annually to just $0.60.
Plus, Compass has a high level of debt and nearly no cash on the balance sheet. That could lead to further reductions in the dividend, and increases the risk of potential bankruptcy.
Action to take: Shares have started to trend higher in the past week, and are still at oversold levels. There may be more room for a relief rally in the weeks ahead, potentially giving investors in shares a low-double-digit return. Especially with fear near its peak.
For traders, the March $22.50 calls, last going for about $1.25, could see mid-double-digit gains on a further trend higher for 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 company mentioned in this article.