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Editors' Note: This article covers a micro-cap stock. Please be aware of the risks associated with these stocks.

The iShares MSCI Canada Small Cap Index ETF (BATS:EWCS) peaked at $25.47 in September 2012. The index is currently trading at $21.55, or 15.4% below the peak made in September 2012.

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In this article, I will feature two Canadian small cap companies that have seen intensive insider buying during the last 30 days. Intensive insider buying can be defined by the following three criteria:

  1. The stock is purchased by three or more insiders within one month.

  2. The stock is sold by no insiders in the month of intensive purchasing.

  3. At least two purchasers increase their holdings by more than 10%.

1. Logistec Corporation (OTC:LTKBF) provides cargo handling and other services to marine, industrial, and municipal customers in Canada and the United States.

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Insider buying by insider (last 30 days)

  • Mario Blanchet purchased 600 shares on June 28 pursuant to a purchase/ownership plan. Mario Blanchet currently holds 21,800 shares or 0.3% of the company. Mario Blanchet is an insider of the company.
  • Rodney Corrigan purchased 200 shares on June 28 pursuant to a purchase/ownership plan. Rodney Corrigan currently holds 200 shares or less than 0.1% of the company. Rodney Corrigan is an insider of the company.
  • George Di Sante purchased 400 shares on June 28 pursuant to a purchase/ownership plan. George Di Sante currently holds 6,600 shares or 0.1% of the company. George Di Sante is an insider of the company.
  • Jean-Claude Dugas purchased 600 shares on June 28 pursuant to a purchase/ownership plan. Jean-Claude Dugas currently holds 8,860 shares or 0.1% of the company. Jean-Claude Dugas is vice-president, finance of Logistec Corporation.
  • Pierre Lefebvre purchased 900 shares on June 28 pursuant to a purchase/ownership plan. Pierre Lefebvre currently holds 7,500 shares or 0.1% of the company. Pierre Lefebvre is vice-president, human resources.
  • Logistec Corporation purchased 3,800 shares on June 11 - July 5.
  • Madeleine Paquin purchased 900 shares on June 28 pursuant to a purchase/ownership plan. Madeleine Paquin currently holds 18,325 shares or 0.3% of the company.Madeleine Paquin has been president and CEO of Logistec Corporation since 1996.
  • Luc Pilon purchased 300 shares on June 28 pursuant to a purchase/ownership plan. Luc Pilon currently holds 300 shares or less than 0.1% of the company. Luc Pilon is Corporate Controller.
  • Frank Vannelli purchased 300 shares on June 28 pursuant to a purchase/ownership plan. Frank Vannelli currently holds 1,500 shares or less than 0.1% of the company. Frank Vannelli is an insider of the company.

Insider buying by calendar month

Here is a table of Logistec's insider trading activity by calendar month.

MonthInsider buying / sharesInsider selling / shares
July 20133,2000
June 20134,8000
May 20131,7000
April 20132,4000
March 20132,4000
February 20135,1000
January 20135,8000

There have been 25,400 shares purchased and there have been zero shares sold by the insiders this year.

Financials

The company reported the first-quarter financial results on May 8 with the following highlights:

Revenue$57.4 million
Net income$1.9 million
Cash$7.9 million
Debt$20.1 million

Outlook

Logistec's outlook is favorable for 2013 as the company should benefit from the ongoing turnaround of the U.S. economy, CrossGlobe's full-year contribution and the reinforcement of the company's biomass handling operations at its Brunswick [GA] terminal. As was the case in the first quarter, Logistec believes its cargo handling business is likely to continue growing in all of the cargo types as well as on a geographic basis. Logistec is also confident in regard to Sanexen's capacity to deliver another solid performance in 2013, as the company expects an increase in the demand for services related to the Aqua-Pipe technology, a further improvement in sales of woven hoses and a satisfactory level of site remediation activities.

Competition

Logistec considers itself as one of the largest stevedoring and terminal operators in Eastern Canada. The competition varies from port to port, since Logistec operates terminals that mainly specialize in various dry niche cargoes. Logistec's strategy to diversify its geographic network, its cargo mix and the balance between export and import activities has served the company well and should allow it to maintain its financial stability in a fluctuating and cyclical market. Continuous profitable results have been achieved over the past 43 years through a focused approach on customer service, qualified employees, progressive labour relations, and modern cargo-handling techniques delivered through a network of strategically located facilities.

My analysis

There have been nine different insiders buying the shares and there have not been any insiders selling the shares during the last 30 days. The stock is trading at a P/E ratio of 10.60 and the stock has a dividend yield of 1.4%. The company has a book value of $19.85 per share. The 200-day moving average is currently at $25.71, which could be a good entry point for the stock.

2. Gamehost (OTC:GHIFF) operates as a hotel and gaming company in Alberta, Canada.

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Insider buying by insider (last 30 days)

  • Gamehost purchased 13,200 shares on June 11-18.
  • Craig Thomas purchased 1,200 shares on June 13-14 and currently holds 12,050 shares or less than 0.1% of the company. Craig Thomas is Chief Financial Officer of the company.
  • Darcy Will purchased 10,000 shares on June 18-28 and currently controls 27,600 shares or 0.1% of the company. Darcy Will is President of the company.

Insider buying by calendar month

Here is a table of Gamehost's insider trading activity by calendar month.

MonthInsider buying / sharesInsider selling / shares
June 201385,8000
May 201382,2255,000
April 2013116,2250
March 201300
February 201300
January 201300

There have been 284,250 shares purchased and there have been 5,000 shares sold by the insiders this year.

Financials

The company reported the first-quarter financial results on May 14 with the following highlights:

Revenue$19.1 million
Net income$4.7 million
Cash$15.8 million
Debt$44.6 million

Outlook

The Alberta economy will continue to be the most significant driver of growth for the company. Simply put, if the province can continue to provide high income jobs attracting increased population, the company will benefit from greater consumer spending on hospitality and gaming.

Competition

  • The closest competition to the Gamehost's Deerfoot casino operations in Calgary remains a First Nations casino 14 kilometers to the west.
  • Gamehost's Great Northern Casino in Grande Prairie is the only full service casino in the city.
  • Gamehost's Service Plus hotel property operates in a highly competitive market, but continues to succeed on superior location and service.
  • Gamehost's management is not aware of any competitive hotel developments or gaming expansions that could have a material effect on the company's operations.

My analysis

There have been three different insiders buying the shares and there have not been any insiders selling the shares during the last 30 days. The stock is trading at a P/E ratio of 12.96 and the stock has a dividend yield of 6.9%. The company has a book value of $4.68 per share. The 200-day moving average is currently at $12.68, which could be a good entry point for the stock.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.