Jason Stabell, CEO at Epsilon Energy (EPSN), recently bought 11,300 shares. The buy increased his stake by 14 percent, and came to a total cost of $57,856.
This is the third buy from the CEO in recent months. In early June, he bought 18,000 shares, paying just over $90,100. And in May, he bought an initial stake of 24,200 shares at a cost of $123,178. Otherwise, a major holder of shares was a big seller last year.
Overall, insiders at the energy exploration and development company own 5.1 percent of shares.
Epsilon has dropped about 5 percent over the past year as energy prices have likewise declined. That’s also apparent in the company’s earnings, which dropped nearly 40 percent, and revenues have decline by over 30 percent.
However, given production cuts around the world an an economy faring well, shares may be oversold at current prices.
Action to take: Investors may like shares here as a value play. Energy looks oversold, and Epsilon trades at less than 4 times earnings.
Plus, the company has over $2 per share in cash, or about 40 percent of the current share price, which can be put to work for further exploration and development.
For traders, options are somewhat limited. But the November $5 calls are right at-the-money. Going for about $0.70, they could see high double-digit returns on any jump higher in 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.