Buffett Loads Up on This Stock Again, Plus CEO Insider Buying

Investing

Published: March 10, 2024 9:50 am

In the wake of a media giant’s quarterly report, the Oracle of Omaha is again bolstering his stake in the tracking stocks with some huge insider purchases. Plus, chief executive officers and an activist investor also scooped up some shares in the following companies.

A well-known adage reminds us that corporate insiders and 10% owners really only buy shares of a company because they believe the stock price will rise and they want to profit from it. Thus, insider buying can be an encouraging signal for potential investors. This is all the more so during times of uncertainty in the markets, and even when markets are near all-time highs.

Remember that even as the earnings-reporting season winds down, some insiders are prohibited from buying or selling shares. Below are some of the more notable insider purchases that were reported in the first full week of March, starting with the largest one.

Liberty Media

insider buying — Buffett resumes buying into Sirius XM satellite radio.

Buyer(s): 10% owner Berkshire Hathaway
Total shares: less than 2.2 million
Price per share: $28.25 to $29.65
Total cost: almost $63.9 million

Following a Liberty Media Corp. (NASDAQ: LSXMK) quarterly report, Berkshire Hathaway has increased its stake in the holding company again to near 50.7 million shares. The stock last seen trading near the top of that purchase price range. However, the share price is over 6% lower than a year ago. Note that Liberty Media and Sirius XM Holdings Inc. (NASDAQ: SIRI) plan to merge, and Liberty Media recently completed an acquisition of its own. (Also note that Buffett sold Apple but continues to buy two big dividend energy stocks.)

More Liberty Media

Warren Buffett — Warren Buffet comes back for more.

Buyer(s): 10% owner Berkshire Hathaway
Total shares: less than 1.5 million
Price per share: $28.38 to $29.80
Total cost: almost $43.6 million

Buffett also has increased the stake in Liberty Media Corp. (NASDAQ: LSXMA) again to around 25.2 million shares. Here too, the shares of this holding company were last seen trading near the top of the purchase price range. The stock has gained about 13% in the past 90 days. As mentioned above, Liberty Media and Sirius XM are in the process of merging, and Liberty Media just posted its fourth-quarter and 2023 results.

89bio

Buyer(s): 10% owner R.A. Capital Management
Total shares: more than 1.3 million
Price per share: $15.35
Total cost: over $20.7 million

This San Francisco-based clinical-stage biopharmaceutical company also just posted its quarterly results. Back in October, 89bio Inc. (NASDAQ: ETNB) stock tumbled after a competitor posted disappointing trial results. However, the share price is up over 94% since then, but it still is less than this buyer’s purchase price. Eight of 10 analysts who follow the stock recommend buying shares. Their consensus price target of $30.44 indicates they see the shares doubling over the next 12 months. That target would be a multiyear high.

Keurig Dr Pepper

Buyer(s): CEO James Gamgort, another officer, two other directors
Total shares: less than 601,400
Price per share: $29.10
Total cost: around $17.5 million

This insider buying took advantage of a secondary offering of Keurig Dr Pepper Inc. (NASDAQ: KDP) shares by beneficial owner JAB BevCo. That offering came in the wake of a mixed fourth-quarter report. The stock pulled back about 5% after the report and is down around 13% year to date. Shares were last seen trading below the offering price, as well as a dollar or so above the 52-week low. The beverage giant has a cautious Buy recommendation from the consensus of analysts. However, their mean price target of $35.28 suggests almost 22% upside potential in the next 12 months.

SLR Investment

Buyer(s): CEOs Michael Gross and Bruce Spohler
Total shares: 173,400
Price per share: $14.95 to $15.29
Total cost: over $2.6 million

This business development company’s recent quarterly report included stable net asset value per share and growing net investment income per share. Shares of SLR Investment Corp. (NASDAQ: SLRC) are trading above the purchase price above and are near a 52-week high. The stock is up about 5% year to date, while the S&P 500 has gained about 7% in that time. The consensus recommendation is to hold shares, and the analysts’ mean price target is less than the current share price. Note that both of these buyers have stakes of more than 3.5 million shares.

Sphere Entertainment

Buyer(s): CEO James Dolan
Total shares: more than 110,100
Price per share: $45.55 to $47.63
Total cost: less than $5.2 million

After scooping up $2.4 million worth of Sphere Entertainment Co. (NYSE: SPHR) shares in the prior week, Nolan returned to the buy window. The New York City-based company recently named new executives, and revenue was better than expected in the most recent quarterly report. Since the beginning of the year, the stock is up nearly 50%, and shares just hit a multiyear high of over $51 apiece. Still, analysts are cautious, with a consensus rating of Hold. Their mean price target is less than the current share price. Note that, at about the same time as this purchase, Dolan also sold about $3.8 million worth of Madison Square Garden Sports Corp. (NYSE: MSGS), for which he is CEO as well.

Citi Trends

Buyer(s): 10% owner Fund 1 Investments
Total shares: more than 141,400
Price per share: $30.50 to $31.34
Total cost: over $4.3 million

This beneficial owner and activist investor aims to shake up the Citi Trends Inc. (NASDAQ: CTRN) board of directors. The next quarterly report is scheduled for later this month, but the retailer already shared holiday sales numbers that were slightly lower year over year. The share price is up more than 12% year to date to just above the buyer’s purchase price range. The stock is almost 20% higher than a year ago, though it has underperformed the S&P 500 in that time. Note that shares have overrun the consensus price target. Also note that this buyer just acquired some shares of Tillys Inc. (NYSE: TLYS), as well as over $2 million worth of Tile Shop Holdings Inc. (NASDAQ: TTSH) last week.

And Other Insider Buying

Smaller amounts of insider buying at Carvana and others.

In the past week or so, some insider buying was reported at Carvana, Caesars Entertainment, Cleveland-Cliffs, Consolidated Edison, FMC, Fresh Del Monte Produce, Lemonade, Lumen Technologies, Perrigo, Redfin, Snowflake, SolarEdge Technologies, and WK Kellogg as well.