Finding profits is definitely the goal of the game when it comes to stock investing, and investors of all genders are always on the lookout for a reliable strategy. One popular method, followed by retail investors looking for accurate clues to bullish stocks, is to monitor insider trading.
Company insiders are company officials, in high positions, who are equally responsible to members of the Board of Directors and shareholders for bringing profits and increasing share prices. Their position gives them a deeper knowledge of the inner workings of their company, knowledge that can inform their opinion of the position a company’s stock is likely to take. where to go.
In short, insiders have a vested interest in trading their own company’s stock. And to prevent that from becoming an unfair advantage, government regulators require them to regularly disclose their trading activity. This is public information and careful investors can view it for suggestions – based on insider buying patterns – of sought-after stocks.
Keeping this in mind, we used Hot stock of insider Tool from TipRanks to point us in the direction of two stocks flashing strong insider buying signals that warrant closer scrutiny. Nor is it a shame that both are high-yielding dividend payers. Let’s take a closer look.
Black rock minerals (BSM)
The first is Black Rock Minerals. Headquartered in Houston, Texas, the company operates as a mineral rights company, purchasing lands in energy-rich producing areas – and holding copyright rights to hydrocarbons (crude oil and natural gas). natural) that manufacturing companies extract from the ground. . Black Stone’s footprint exceeds 20 million acres and spans 41 states; The company’s largest holdings are in Alabama-Mississippi, Arkansas-Louisiana-Texas-Oklahoma and North Dakota-Montana.
Black Stone has benefited from their own ongoing efforts in acquiring land rights and relatively high oil and gas prices over the past year. With one bright spot – a consecutive decline in the first quarter of this year – the company has seen a steady increase in revenue over the past few years. In 3Q22, the previous quarter reported, the company had top revenue of $216.4 million, more than triple the $59.8 million reported in 3Q21. Black Stone’s net income came in at $168 million, compared with just $16 million in the same period last year, and diluted EPS, at 75 cents, was much higher than the 5 cents reported a year earlier.
Of particular interest to dividend investors, distributed cash flow reached $116 million in the third quarter, a company record and up 9% from the previous quarter. The distributed cash flow is used to support the dividend, recently announced for Q4 22 at 45 cents per common share. This is up from 42 cents in Q2 and an impressive 80 percent increase from Q2 of 21. At current rates, the 45 cent annual payout comes to $1.80 and offers a high yield of 9. ,8%.
Moving on to insiders trading, we see that the CEO and Chairman, Thomas Carter, last week spent $968,500 buying 50.00 BSM shares.
Analyst Eduardo Seda included this stock for Jones Trading and he liked what he saw – especially the ability to expand the company’s footprint to new growth.
“Development is still going strong on the BSM acreage, and the volume of royalties from new wells coming online… on the high interest acreage in the Shelby bottom. As a result, BSM increased its copyrighted production in Q3 of 22 compared to a year ago and Q2 of 22. We note that there are now 92 rigs operating across BSM’s area, a sharp increase. from 81 rigs in Q2/2012 and a significant increase from 59 rigs a year ago. Overall, with continued growth in area and as commodity price environment for crude oil and natural gas remains high (albeit with some declines), BSM has produced operating results. good,” said Seda.
Consistent with his positive take on Black Stone’s view, Seda rates the stock a Buy. His $23 price target implies that it is likely to rally ~20% over the next year. (To see Seda’s achievements, click here)
Among Seda peers, BSM has a moderate Buy consensus rating, based on 2 equally divided Buys and Holds, each. (View BSM stock forecast on TipRanks)
National Archives Branches (NSA)
For the second stock, we will move into the realm of Real Estate Investment Trusts (REITs) and National Archives Branches. The company specializes in acquiring, owning, and operating self-storage facilities in high-quality, high-growth markets. This niche-rated national archive is particularly useful in the current economic climate, as self-storage has been shown to be resistant to recession over the long term.
Regression resistance can be helped at scale, and National Storage takes this to the next level. The company can boast 1,100 properties across 42 states plus Puerto Rico, for a total of 71.5 million square feet of rentable properties in its portfolio. More than 200 of these locations are located in Texas, 98 in California and 90 in Florida. National Storage also has a significant footprint in Louisiana, Alabama, Georgia, Tennessee and North Carolina; It is no coincidence that the company has a wide presence in the Southeast, one of the fastest growing regions in the country.
Earlier this month, National Storage reported its 22nd quarter results. In the statement, the company said it purchased 23 new properties during the quarter, for a total price of $321.8 million. The company also reported net income of $40.2 million for the third quarter, down slightly from the previous quarter. EPS, at 21 cents, missed the 28 cent forecast.
National Storage has seen its financial backing from an increase in net operating income of the same store, which was 12% compared with the third quarter of last year. Total sales of the same store also increased 10.7% over the same period last year.
Also in Q3, the company repurchased nearly 1 million shares under the previously authorized share buyback policy. The buyback program is capped at $400 million.
Buyers bring us to the management’s return policy, which also includes 55% of the common stock dividend. This was declared and paid in September. The payout has been increased fivefold over the past six quarters and the current rate, calculated annually at $2.20, yields a yield of 5.4%. The yield is almost three times the average found in the broader markets and comes with a 7-year history of reliability.
Insider sentiment of this stock is very positive, as high as possible, after a series of buying news this week. These purchases ranged from $11,032, for 292 shares – to $2 million from Arlen Nordhagen, executive chairman and member of the Board of Directors. Nordhagen bought 53,000 shares for that transaction, which made insider sentiment more positive towards the stock.
Insiders aren’t the only upbeat voices here. 5 star analyst Steve Manaker, from Stifel, the NSA rates the stock Buy, while his $50 price target implies a 22% gain over the next 12 months. (To see Manaker’s track record, click here)
Against his stance, Manaker wrote, “We like strategy; REITs bring sophisticated analytical tools to markets where few players use them (or technically sophisticated tools like REITs) and this will lead to massive growth. Additionally, National Storage faces less competition for assets in these markets. Many institutional investors don’t focus on them because they’re in the top 25. Despite their strong outlook and (albeit short) history of double-digit growth, we believe National Storage stock is on the way. attractively priced. “
This is another stock that is evenly distributed among analysts. The 6 on file include 3 to Buy and 3 to Hold, for a moderate Buy consensus rating. (View NSA stock forecast on TipRanks)
To find good ideas for trading stocks at attractive valuations, visit TipRanks’ Best stocks to buya tool that consolidates all TipRanks equity insights.
Disclaimer: The opinions expressed in this article are those of prominent analysts only. Content is used for informational purposes only. It is very important to do your own analysis before making any investments.