The bulletproof market stumbles on; not escalating war in the Middle East or a tumultuous Presidential election in the U.S. seems to faze it. Insiders are mainly sitting this one out, whether it’s the priciness of the market or the quarterly earnings blackout window; insiders are on the sidelines except when it comes to selling. They are hitting the bid like trout on a hatchery pond. Notable sales alone last week included Draft King, Banc of America (Berkshire unloading), Carvana, Seagate Technology, Toll Brothers, and that was just what was reported on Friday last week. It’s hard to glean much from the selling other than many people feel like they are cashing out at the top, and they might be right. Predicting the market is a fool’s errand, so back to the mission at hand.
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Name: Robert W Gerrity
Position: Chief Executive Officer
Transaction Date: 2023-09-13 Shares Bought: 10,000 Average Price Paid: $24.73 Cost: $247,300
Company: Vitesse Energy Inc. (VTS)
Name: James P Henderson
Position: Chief Financial Officer
Transaction Date: 2023-09-14 Shares Bought: 10,000 Average Price Paid: $22.99 Cost: $229,900
Company: Vitesse Energy Inc. (VTS)
Vitesse Energy, Inc. was founded in 2014 and is headquartered in Greenwood Village, Colorado. Vitesse Energy, Inc. and its subsidiaries buy, develop, and produce non-operated oil and gas properties in the United States. The company acquires non-operated working and royalty interests in Williston Basin properties in North Dakota and Montana. The corporation also has non-operating interests in Central Rockies properties in Colorado and Wyoming.
Mr. Robert W. Gerrity, also known as Bob, has served as Vitesse Energy, LLC’s Chairman of the Board since January 13, 2023, and its CEO and Director since August 5, 2022. Vitesse began in the Bakken in 2010, when Bob invested his money to purchase non-operated working interest acreage. Bob has personally worked on more than 500 gross wells to date. Bob got his start in the oil industry in 1982 when he purchased a stake in four recently dug Codell wells in Colorado’s Wattenberg Field. He established Gerrity Oil and Gas Corporation (Gerrity Oil) as a low-cost operator that produced economic performance in a low-price market.
James “Jimmy” Henderson has been designated Vitesse’s Chief Financial Officer, effective September 1, 2023, and is responsible for all financial elements of the organization. Jimmy has almost 30 years of experience in the oil and gas industry, covering management, finance, and accounting. He most recently worked as Executive Vice President of Finance and Chief Financial Officer at Whiting Petroleum, which exited from bankruptcy in September 2020 and merged with Oasis Petroleum in July 2022 to form Chord Energy. Jimmy formerly worked at SRC Energy and Kodiak Oil & Gas, where he oversaw acquisitions and capital expenditures to grow both businesses. Jimmy had increasingly responsible positions in Western Gas Resources, Aspect Energy, and Pennzoil Company before taking on these senior duties. Jimmy received a B.B.A. in Accounting from Texas Tech University and a Master of Business Administration from Regis University.
Opinion: Vitesse is another royalty play on hydrocarbons currently yielding 8.77%. The fear that the combustion engine transportation market is vanishing might just be disrupted by the growth of the AI data center. They are not all going to be powered by nuclear energy and solar. Plenty of gas-fired electricity data centers are going to be popping up unceremoniously.
Name: Mark Lappe
Position: Chief Executive Officer
Transaction Date: 2024-09-12 Shares Bought: 40,000 Average Price Paid: $15.73 Cost: $629,117
Company: Inhibrx Biosciences Inc. (INBX)
Inhibrx Biosciences, Inc. was created in 2024 and is headquartered in La Jolla, California. The company is a clinical-stage biopharmaceutical company that creates biological treatments for people with life-threatening illnesses. INBRX-109, a tetravalent therapeutic candidate targeting death-receptor 5 that is in phase 2 clinical trial for the treatment of unresectable or metastatic conventional chondrosarcoma; and INBRX-106, a hexavalent sdAb-based therapeutic candidate targeting OX4 that is in phase 2 clinical trial for the treatment of metastatic solid tumor, non-small cell lung cancer, melanoma, head and neck cancer, gastric (GIST), and gastroesophageal adenocarcinoma (GEA) cancer, renal cell carcinoma, and urothelial (transitional) cell carcinoma.
Mr. Lappe co-founded Inhibrx in 2010 and has served as its CEO since then. He also serves as the chairman of our Board of Directors. Mr. Lappe has over 30 years of expertise in senior management, investment management, and executive recruiting, having put together executive teams for over 40 start-up biotechnology and medical device companies. Before founding Inhibrx, Mr. Lappe was the founder and Managing Partner of Efficacy Biotech Fund, which made strategic investments in publicly traded biotech companies.
Opinion: I’ve been touting this name for some time. I keep comparing it to Biohaven and the Pfizer acquisition. By the way, Biohaven took off last week, which is up nearly 20%. Stay long with this name.
Name: Liberty 77 Capital L.P. / Liberty 77 Fund International L.P. / STM Partners LLC / Steven T Mnuchin
Position: 10% Owner
Transaction Date: 2024-09-23 Shares Bought: 533,814 Average Price Paid: $6.75 Cost: $3,601,074
Company: Lions Gate Entertainment Corp (LGF-B)
Lions Gate Entertainment Corporation was founded in 1986, with its headquarters in Santa Monica, California. Lions Gate Entertainment Corp. operates in the film, television, subscription, and location-based entertainment markets in the United States, Canada, and across the world. The corporation is divided into three business units: film, television production, and media networks. The Motion Picture branch creates and produces feature films, acquires North American and global distribution rights, distributes North American feature films in cinemas, home entertainment, and on television, and licenses global distribution rights. Television Production develops, produces, and distributes series, films, miniseries, and nonfiction programming globally. Media Networks distributes STARZ-branded premium subscription video services both domestically and abroad via over-the-top platforms and video programming distributors such as cable operators, satellite TV providers, and telecommunications companies.
Liberty 77 Capital L.P., doing business as Liberty Strategic Capital, is a private equity firm. The company mostly invests in technological firms. Liberty Strategic Capital services consumers throughout the state of Washington. Steven T. Mnuchin, former Secretary of the Treasury, leads the firm, which was created in 2021.
Liberty 77 Fund International LP engages in the Financial Services sector. The company is headquartered in Washington, D.C.
STM Partners LLC, a Delaware limited liability company, exercises indirect control over the Liberty Manager and the Liberty Funds’ general partner. Steven T. Mnuchin is the President of STM Partners LLC.
Steven T. Mnuchin is Liberty Strategic Capital’s founder and managing partner, as well as the chair of the Investment Committee. Mr. Mnuchin formerly served as the 77th Secretary of the Treasury, holding the position from February 2017 to January 2021. Mr. Mnuchin oversaw the US Treasury’s efforts to preserve a strong economy, encourage economic growth, and generate job opportunities by creating conditions conducive to success both at home and abroad. Mr. Mnuchin also oversaw cybersecurity for the financial services industry and all Treasury divisions, including the IRS. Before being confirmed, he created, chaired, and directed Dune Capital Management. He formed OneWest Bank Group LLC and served as its Chairman and CEO until it was sold to CIT Group Inc. Secretary Mnuchin previously worked for The Goldman Sachs Group, Inc., where he was a Partner and Chief Information Officer, responsible for the firm’s global information and technology strategy and operations. Secretary Mnuchin received a bachelor’s degree from Yale University.
Opinion: I’m definitely losing my patience with Treasury Secretary Mnuchin. Please buy or get off the pot.
Name: Gary Guidry
Position: President and CEO
Transaction Date: 2024-09-17 Shares Bought: 100,000 Average Price Paid: $6.17 Cost: $617,000
Company: Gran Tierra Energy Inc. (GTE)
Gran Tierra Energy Inc. was created in 2003 and is based in Calgary, Canada. Gran Tierra Energy Inc., along with its subsidiaries, is a corporation engaged in oil and gas exploration and production, with properties in Colombia and Ecuador. The Colombian properties accounted for 94% of proven reserves NAR as of December 31, 2023.
Gary Stephen Guidry is now employed with Gran Tierra Energy, Inc. as President, CEO, and Non-Independent Director since 2015; Africa Oil Corp. as an Independent Director since 2008; and the Association of Professional Engineers and Geoscientists of AB as a Member. Before joining Gran Tierra, Mr. Guidry was President and CEO of Caracal Energy Inc., a London Stock Exchange-listed oil and gas firm with operations in Chad, Africa. In 2014, Mr. Guidry received the Oil Council Executive of the Year award for his leadership position at Caracal. Before joining Caracal, Mr. Guidry was President and CEO of Orion Oil and Gas, which operated in western Canada from mid-2009 to mid-2011, when it merged. From May 2005 to December 2008, he was the President and CEO of Tanganyika Oil Company, which operated in Syria and Egypt. Prior to Tanganyika, Mr. Guidry was the CEO of Calpine Natural Gas Trust. He earned a Bachelor of Science in Petroleum Engineering from Texas A&M University in 1980.
Opinion: You don’t have to go to Columbia to find bargains in the oil patch. South Texas, the Permian and Delaware Basin are screaming buy, buy, buy.
Name: Jason Stabell
Position: Chief Executive Officer
Transaction Date: 2024-09-18 Shares Bought: 74,000 Average Price Paid: $5.05 Cost: $373,700
Company: Epsilon Energy Ltd. (EPSN)
Name: Andrew Williamson
Position: Chief Financial Officer
Transaction Date: 2024-09-18 Shares Bought: 50,000 Average Price Paid: $5.05 Cost: $252,500
Company: Epsilon Energy Ltd. (EPSN)
Epsilon Energy Ltd. was founded in 2005 and is headquartered in Calgary, Canada. Epsilon Energy Ltd., a North American onshore independent natural gas and oil company, engages in the acquisition, development, gathering, and production of natural gas and oil reserves in the United States. The company operates in two segments: upstream and gathering systems. The Marcellus Shale in Pennsylvania generates natural gas. In contrast, the Permian Basin in Texas and New Mexico, as well as the Anadarko Basin in Oklahoma, generate oil, natural gas liquids, and natural gas.
Jason Stabell took over as Epsilon’s CEO on July 1, 2022. Mr. Stabell has been working in the energy sector since 1998, particularly in upstream exploration and production. He was most recently the President and CEO of Merlon International, LLC, a privately held company with properties in Egypt’s Western Desert and the United States Gulf Coast that was sold to a publicly traded UK corporation in 2019 and where he served as an advisor until 2021. He formerly served as CFO and later President of Merlon Petroleum Company, a privately held company with operations in the US Gulf Coast and Egypt that was sold in 2006. He started his career at Salomon Smith Barney as a Planning and Analysis Group analyst. In recent years, Mr. Stabell has been active as a private investor. He graduated from Williams College with a bachelor’s degree in Economics. He has been on the boards of ESI Energy Services Inc. and Layline Petroleum LLC.
Andrew Williamson has spent his whole career in the energy industry. From 2012 to early 2019, he served as Merlon International, LLC’s Corporate Development Manager before becoming Vice President of Finance. He most recently served as the Corporate Strategy Manager at Petrosantander Inc. Mr. Williamson began his career as a management consultant, advising energy companies on transaction due diligence, growth strategy, and cost-cutting. He received a BBA in Finance and Political Science from Southern Methodist University.
Opinion: Like I said, follow the money. I doubt if Trump will hurt oil prices as he did the last time, unleashing American production. The producers today have a lot of restraint and the capital markets especially so
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Insiders sell the stock for many reasons, but they generally buy for just one – to make money. You’ve always heard the best information is inside information. Everyone with any stock market experience pays close attention to what insiders are doing. After all, who knows a business better than the people running it? Officers, directors, and 10% owners are required to inform the public through a Form 4 Filing of any transaction, buy, sell, exercise, or any other within 48 hours of doing so. This info is available for free from the SEC’s Web site, Edgar, although we subscribe to SECForm4 as they provide a way to manage and make sense of the vast realms of data. I’ve tried a lot of vendors. SECForm4 is one of the smaller ones, but I like supporting Frank. He is not arrogant. He’s helpful and has great prices. He also trades on his own data, so I like people that eat what they kill.
The bar is different from selling because the natural state of management is to be a seller. This is because most companies provide significant amounts of management compensation packages as stock and options. Therefore, we analyze unusual patterns with selling, such as insiders selling 25 percent or more of their holdings or multiple insiders selling near 52-week lows. Another red flag is large planned sale programs that start without warning. Unfortunately, the public information disclosure requirements about these programs, referred to as Rule 10b5-1, are horrendously poor. Also, planned sales that pop up out of nowhere are basically sales and are seeking cover under this corporate welfare loophole. I also generally ignore 10 percent shareholders as they tend to be OPM (other people’s money) and perhaps not the smart money on which we are trying to read the tea leaves. I say generally because some 10% shareholders are great investors. Think Warren Buffett and others
Of course, insiders can also be wrong about their Company’s prospects. Don’t let anyone fool you into believing they never make mistakes. Do your own analysis. They can easily be wrong, and in many cases, maybe most cases, have no more idea what the future may hold than you or me. In short, you can lose money following them. We have, and we curse aloud; what were they thinking!
We like Fly on the Wall for keeping up with what events might be happening, analysts’ comments, and whatever else could be moving the stock. Dow Jones news service is an essential tool, but many services pick up their feed like they do Bloomberg. For quick financial analysis, it’s hard to beat Old School Value.
A big callout to my assistant Ambreen who sets up this conversation by listing the notable buys that I’ve identified. She probes the 10k for a reasonable description of the business. I’ve found that to be the most accurate and succinct place to find out what a business actually does.
This blog is solely for educational purposes and the author’s own amusement. Think of the blog as part of my personal investment journal that I am willing to share with the DIY investor. There are also many parts that I am not willing to share if I think it could influence trading action or be detrimental to the Fund’s partners. We could be long, short, or have no position at all in any of the stocks mentioned and express no written or implied obligation to disclose any of that.
The Insiders Fund is for qualified investors and by Prospectus only. Nothing herein should be construed otherwise. THE INSIDERS FUND prefers to invest in companies at or near prices that management has been willing to invest significant amounts of their own money in, but we have no requirement to do so. We also invest in many companies in anticipation of future insider buying or with the expectation that there is none at all.
You can be an insider, too– by clicking here
Prosperous Trading,
