Surge Energy: 3 Different Insiders Have Purchased Shares This Month

Apr.19.14 | About: Surge Energy, (ZPTAF)

Summary

Three insiders have purchased Surge Energy stock within one month.

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

Two of these three insiders increased their holdings by more than 10%.

Surge Energy (OTCPK:ZPTAF) explores for, develops, produces, and markets petroleum and natural gas reserves primarily in Western Canada.

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Insider buying during the last 30 days

Here is a table of Surge Energy's insider activity during the last 30 days.

Name Title Trade Date Shares Purchased Current Ownership Increase In Shares
Paul Colborne Director April 10-17 385,000 2,329,147 shares +19.8%
Robert Leach Director April 17 50,000 251,058 shares +24.9%
Maxwell Lof CFO April 16 282 6,806 shares +4.3%
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There have been 435,282 shares purchased by insiders during the last 30 days.

Insider buying by calendar month

Here is a table of Surge Energy's insider activity by calendar month.

Month Insider buying / shares Insider selling / shares
April 2014 435,282 0
March 2014 0 0
February 2014 130,000 0
January 2014 0 0
December 2013 0 50,000
November 2013 0 20,472
October 2013 0 0
September 2013 0 0
August 2013 0 0
July 2013 240,390 0
June 2013 702,280 0
May 2013 0 0
April 2013 0 0
March 2013 0 0
February 2013 0 0
January 2013 310,500 0
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There have been 1,818,452 shares purchased, and there have been 70,472 shares sold by insiders since January 2013.

Financials

Surge Energy reported the full-year 2013 financial results on March 20 with the following highlights:

Revenue C$271.9 million
Funds from operations [FFO] C$133.2 million
Net loss C$9.9 million
Net debt C$305.3 million
Oil production 10,769 boe/d
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The three insiders purchased their shares after these results.

Outlook

Surge Energy's 2014 guidance is as follows:

Production 16,125 boe/d
FFO C$246 million
Dividend C$96 million
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Competition

Surge Energy's competitors include Raging River Exploration (OTC:RRENF) and Bonavista Energy Corporation (OTCPK:BNPUF). Here is a table comparing these companies.

Company ZPTAF RRENF BNPUF
Market Cap: 1.15B 1.48B 3.15B
Qtrly Rev Growth (yoy): 0.50 0.77 0.11
Revenue: 226.51M 163.24M 855.90M
EBITDA: 125.39M 118.48M 470.11M
Operating Margin: -0.06 0.27 0.12
Net Income: -10.08M 44.24M 50.45M
EPS: -0.10 0.27 0.26
P/E: N/A 31.28 61.45
P/S: 4.98 9.06 3.62
P/B: 1.20 3.66 1.33
Dividend Yield: 7.8% 0.0% 4.9%
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Surge Energy has the highest dividend yield among these three companies.

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

Company Insider buying / shares Insider selling / shares
RRENF 0 208,800
BNPUF 0 1,655,374
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Only Surge Energy has seen intensive insider buying during the last 30 days.

Conclusion

There have been three different insiders buying Surge Energy, and there have not been any insiders selling Surge Energy during the last 30 days. Two of these three insiders increased their holdings by more than 10%.

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(Source: Investor presentation)

The three insiders purchased their shares at prices ranging from $6.22 (C$6.84) to $6.40 (C$7.04). I believe Surge Energy could be a good pick below $6.40 based on the intensive insider buying.

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(Source: Investor presentation)

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