Insiders invest in their own companies for one of two reasons. They either believe that business is about to get better, or that the company is undervalued. Whatever the reason, insider buying indicates that those within the organization expect the company’s share price to rise.
In this report, we are going to highlight some interesting insider buying at HF Sinclair Corp (DINO:US). HF Sinclair is a diversified energy company. Headquartered in Dallas, Texas, it manufactures and sells products such as gasoline, diesel fuel, jet fuel, renewable diesel, specialty lubricant products, specialty chemicals, and specialty and modified asphalt. The company is listed on the New York Stock Exchange and currently has a market capitalization of $13.08 billion.
Insider buying at HF Sinclair
Our data shows that on November 10, Chairman Franklin Myers bought 10,000 DINO shares at a price of $60.88 per share. This trade cost the insider $608,800 and increased his holding to 119,608 shares.
This trade is worth highlighting due to the fact that Mr. Myers has made a number of well-timed trades in the recent past. In May this year, for example, the insider bought 10,700 shares at a price of $46.27 per share. He also bought 20,000 shares at a price of $34.57 per share in November last year. These trades will have generated substantial profits for the insider.
It’s worth noting that Mr. Myers – who has been a director since 2011 and has served as Chair since February 2019 – has investment experience. He has served as a senior advisor of Quantum Energy Partners, a private equity firm, since February 2013. He also served as an operating advisor to Paine & Partners, LLC, a private equity firm, from 2009 through 2012.
HF Sinclair’s recent Q3 results showed that the company has momentum right now.
For the period, sales and other revenues came in at $10.6 billion, up from $4.7 billion a year earlier. Meanwhile, net income attributable to stockholders surged to $954.4 million from $280.8 million a year earlier. Refinery gross margin was $31.47 per produced barrel, up 112% year on year.
As a result of this strong performance, the group returned over $950 million to shareholders through dividends and share repurchases during the quarter.
“HF Sinclair’s solid third quarter results were driven by robust product margins and record throughputs in our refining segment. We returned over $951 million in cash to shareholders through share repurchases and dividends during the quarter, and another $152 million in the month of October. With the announcement of our new $1 billion share repurchase authorization in September, we remain fully committed to our cash return strategy and long-term payout ratio,” commented HF Sinclair’s CEO Michael Jennings.
In light of this momentum, we see the insider buying here as a bullish indicator.