Element Financial: 12 Different Insiders Have Purchased Shares During The Last 30 Days

| About: Element Financial (ELEEF)

In this article, I will feature one financial services company that has 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 increased their holdings by more than 10%.

Element Financial Corporation (OTC:ELEEF) originates, co-invests in, and manages asset-based financings for the end-users, distributors, and manufacturers of capital equipment in Canada and the United States.


(Click to enlarge)

Insider buying during the last 30 days

Here is a table of Element's insider-trading activity during the last 30 days by insider.

Name Title Trade Date Shares Purchased Prospectus Current Ownership Increase In Shares
Philip Arthur Director Nov 27 10,000 No 25,000 shares +66.7%
Harold Bridge Director Dec 17 8,150 Yes 111,450 shares +7.9%
Paul Campbell Insider Dec 17 5,000 Yes 55,510 shares +9.9%
Gordon Giffin Director Dec 17 10,000 Yes 30,000 shares +50.0%
Michael Harris Director Dec 17 7,000 common shares + 4,000 preferred shares Yes 130,665 common shares + 4,000 preferred shares +8.9%
Pierre Lortie Director Dec 17 2,500 common shares + 3,000 preferred shares Yes 80,809 common shares + 3,000 preferred shares +7.0%
Stephens Lowden Director Dec 17 10,000 Yes 77,500 shares +14.8%
Karen Martin Senior Officer Dec 17 12,500 Yes 38,250 shares +48.5%
Jim Nikopoulos Senior Officer Dec 17 10,000 Yes 13,650 shares +274.0%
Stephen Sands CCO Dec 17 5,000 Yes 334,425 shares +1.5%
Steven Small Executive Vice-Chairman Dec 17 10,000 common shares + 20,000 preferred shares Yes 970,765 common shares + 20,000 preferred shares +3.1%
Paul Stoyan Director Dec 17 10,000 preferred shares Yes 10,000 preferred shares from 0 to 10,000

There have been 127,150 shares purchased by insiders during the last 30 days.

Insider buying by calendar month

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

Month Insider buying / shares Insider selling / shares
December 2013 117,150 0
November 2013 10,000 0
October 2013 0 0
September 2013 0 0
August 2013 5,000 0
July 2013 0 0
June 2013 1,583,000 0
May 2013 0 0
April 2013 0 0
March 2013 359,075 0
February 2013 0 0
January 2013 0 0

There have been 2,074,225 shares purchased and there have been zero shares sold by insiders this year.

Financials

Element reported the third-quarter financial results on November 13 with the following highlights:

Revenue $46.4 million
Net income $7.8 million
Cash $52.3 million
Debt $1.7 billion
Book value $5.72 per share

On December 17, Element closed a $560 million financing package.


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(Source: November presentation)

Outlook

Element's 2014 operating EPS is expected to be $0.68 in 2014 by analysts.


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(Source: November presentation)

Competition

Element's competitors include Marlin Business Services (NASDAQ:MRLN), and NewStar Financial (NASDAQ:NEWS). Here is a table comparing these companies.

Company ELEEF MRLN NEWS
Market Cap: 2.08B 323.39M 873.14M
Employees: 420 276 104
Qtrly Rev Growth (yoy): 1.45 0.18 0.05
Revenue: 98.14M 67.23M 83.36M
Gross Margin: N/A 1.00 1.00
Operating Margin: 0.42 0.39 0.41
Net Income: -4.84M 15.84M 24.45M
EPS: -0.04 1.27 0.45
P/E: N/A 20.39 39.87
PEG (5 yr expected): N/A 1.49 1.29
P/S: 21.16 4.75 9.71

Element has the fastest revenue growth among these three companies.

Here is a table of these competitors' insider-trading activities this year.

Company Insider buying / shares Insider selling / shares
MRLN 2,500 130,065
NEWS 8,000 0

Only Element has seen intensive insider buying during the last 30 days.

Conclusion

There have been 12 different insiders buying Element and there have not been any insiders selling Element during the last 30 days. Six of these 12 insiders increased their holdings by more than 10%.


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(Source: November presentation)

Element has grown its assets from $6.5 million to $2.7 billion since March 2010. The 200-day moving average is currently at $11.89, which could be a good entry point for the stock based on the intensive insider buying.


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(Source: November presentation)

Disclosure: I have no positions in any stocks mentioned, but may initiate a long position in OTC:ELEEF over 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.