Sprott Resource: 3 Different Insiders Have Purchased Shares This Year

Jan.20.14 | About: Sprott Resource (SCPZF)

In this article, I will feature one resource stock 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%.

Sprott Resource Corp. (OTCPK:SCPZF) invests and operates in oil and gas, energy, agriculture and agricultural nutrient projects, precious metals, and other natural resources.

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Insider buying during the last 30 days

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

Name Title Trade Date Shares Purchased Current Ownership Increase In Shares
Arthur Einav General Counsel Jan 15 9,350 12,904 shares +263.1%
Andrew Stronach Managing Director Jan 15 16,000 20,648 shares +344.2%
Steve Yuzpe CEO Jan 15 30,000 47,500 shares +171.4%
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There have been 55,350 shares purchased by insiders during the last 30 days.

Insider buying by calendar month

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

Month Insider buying / shares Insider selling / shares
January 2014 55,350 0
December 2013 50 0
November 2013 0 0
October 2013 0 0
September 2013 0 0
August 2013 0 0
July 2013 0 0
June 2013 0 0
May 2013 0 0
April 2013 0 0
March 2013 0 0
February 2013 0 0
January 2013 58,000 0
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There have been 113,400 shares purchased, and there have been zero shares sold by insiders since January 2013.

Financials

Sprott Resource reported the third-quarter financial results on November 14 with the following highlights:

Revenue $8.9 million
Net loss $8.4 million
Cash $7.3 million
Debt $57.6 million
NAV $3.86 per share
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(Source: Investor presentation)

News

On January 13, Sprott Resource provided a business update with a new NAV estimate. As at December 31, 2013, Sprott Resource's management expects NAV to be in the range of $340 million or $3.43 per common share to $370 million or $3.74 per common share.

Peer analysis

Sprott Resource has been outperforming the benchmarks since September 2007.

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(Source: Investor presentation)

Conclusion

There have been three different insiders buying Sprott Resource, and there have not been any insiders selling Sprott Resource during the last 30 days. All three of these insiders increased their holdings by more than 10%. Sprott Resource has an insider ownership of 12%.

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(Source: Investor presentation)

Sprott Resource is trading below the estimated net asset value of $3.43-$3.74 per share. I have a long position in the stock currently.

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(Source: Investor presentation)

Disclosure: I am long SCPZF. 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.