Insider buying can provide investors with crucial insights. Insiders know their companies more intimately than anyone else and research shows that their purchases and sales of company stock are often timed very well.
In this report, we are going to highlight some insider buying at Goldman Sachs BDC Inc (GSBD:US). Goldman Sachs BDC is a specialty finance company that is focused on lending to middle-market companies, primarily in the US. Its objective is to generate current income and, to a lesser extent, capital appreciation by investing in debt and equity securities. The company is listed on the New York Stock Exchange and currently has a market capitalization of $2.0 billion.
Goldman Sachs BDC: Insider Buying
Our records show that between 10 March and 11 March, two insiders at Goldman Sachs BDC bought stock. Board member Susan McGee made two purchases, buying a total of 21,787 shares. Meanwhile, fellow board member Ann Lane made one purchase, buying 10,000 shares. Combined, these insiders spent approximately $610,000 on GSBD shares.
Previous Insider Trades Were Timed Well
This insider trading activity is worth highlighting for a couple of reasons. Firstly, previous insider purchases here have been timed well. For example, last March, a number of insiders purchased GSBD stock when it was trading between $10 and $12. Since then, it has risen to $20.
Secondly, both of these insiders have significant investment management experience. Previously, Ms. McGee worked for 26 years at US Global Investors, Inc., an investment management firm, where she held several senior management positions including President. Ms. Lane previously worked at JPMorgan Chase & Co as well as Citigroup where she held several management positions. This industry experience means these insiders are likely to know what they are doing.
Solid Q4 Results
Goldman Sachs BDC posted a solid set of fourth-quarter results in February. For the three months ended 31 December, total investment income was $78.9 million, up from $31.5 million at 30 September 2020. Total investment income was boosted by interest-bearing investments acquired as part of the company’s merger with Goldman Sachs Middle Market Lending Corp during the quarter. Adjusted earnings per share came in at $0.94, up from $0.80 at 30 September 2020. At year end, the value of the company’s investment portfolio was $3,242.8 million compared to $1,431.2 million at the end of September. On the back of this solid performance, analysts at Citigroup raised their price target for the stock.
In light of this solid performance, we see the insider buying here as bullish.