Insider Trading Report: Energy Transfer (ET)

Kelcy Warren, Chairman of the Board at Energy Transfer (ET) has bought 1,500,000 shares in 3 separate transactions over the past week. In total, those buys have added up to over $19 million.

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  • And that doesn’t include a series of buys earlier in May, or even back in February. Warren has been the sole active insider this year with massive buys, but other company executives were buyers last year at similar prices to where shares trade today.

    Even with the massive pace of buying recently, insiders own 17.2 percent of shares.

    The oil and gas midstream company is up about 10 percent over the past year. Energy prices have fluctuated in that time, and revenues are down 7 percent, and earnings are down over 12 percent.

    However, the company is still cheap, with shares trading at just 6 times forward earnings.

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  • Action to take: Income investors may like shares at current prices or on a drop lower, as it’s a high-yielding limited partnership structure. Energy Transfer currently pays a 9.6 percent dividend, and has room for further increase with energy prices.

    For traders, shares have been trending gradually higher over the past year. The July $13 calls, last going for about $0.31, offer mid-double-digit returns in the coming months should this trend continue.


    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.

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