Insider Trading Reports: Parker Drilling Co. (PKD)

Parker Drilling Co. (PKD)

Major owner adds to stake.

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  • Highbridge Capital, a major owner in Parker Drilling Co. (PKD), added another 43,029 shares. The buy increased the fund’s stake by nearly 2.9 percent. The purchase price came to just over $760,000.

    This marks the first insider activity at the company this year.

    Last year saw only sales by insiders, dominated by repeat sales from another fund with a major stake. A few corporate employees sold off shares as well.

    Shares of the oil and natural gas drilling company have struggled in the past few years, but a series of reverse-splits have allowed the company to stay listed on the NYSE.

    Action to take: On a valuation basis, shares look better than the drilling industry as a whole right now. Shares trade around 6 times forward earnings, and the company trades at less than half its price to sales.

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  • However, the company is currently operating at a loss, and slight insider buying in the industry doesn’t mean an immediate turnaround.

    Given that shares have bounced around between $15 and $20, and currently go in the high $17 range, prospective investors would be best to wait for a pullback under $16 before building a stake.

    Speculators would likewise want to wait for a drop, so that they could buy call options with a $20 strike to bet on the next swing upward. Shares currently are in a downswing, having slid from over $22 at the start of the year.

     

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