Carl Icahn, a major owner at Southwest Gas Holdings (SWX), recently added 9,652 shares. The buy came to a total price of $559,700, and increased his holdings by less than one percent.
Icahn has been increasing his position since March, buying over 3 million shares in total across a number of transactions. Company insiders were last sellers of shares in June 2022, when the share price was about 50 percent higher than where the stock trades today.
Overall, insiders own about 0.5 percent of shares, and institutional owners like Icahn own 91 percent of the stock.
The natural gas distributer and transportation utility is down about 30 percent over the past year.
While revenues rose over 25 percent in the past year, Southwest has lost money, but trades at an estimated 18 times forward earnings.
Action to take: The utility pays a 4 percent dividend at current prices, and should be a steady player over time. With interest from Icahn, it’s possible the company could be a contender for an asset sale that may unlock value. Plus, shares have started to trend higher in recent weeks.
For traders, the current uptrend may continue for a few more months. The October $70 calls, last going for about $1.05, could return mid-double-digit gains on a continued rally higher. Traders should look to take profits 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.