Dear Fellow Insider:
Good afternoon. We’re still under a very Yellow flag with momentum, meaning it’s dangerous right now to start trading. We want to wait out this process - largely due to the ongoing turmoil over Higher for Longer for interest rates.
I’ve been in Baltimore, meeting with my new Publishers about what to do with my newsletters and how to produce a greater customer experience for everyone. Those conversations will be ongoing into next week - and I’ll keep you informed on what they want to do and what benefits we’ll bring to you in the coming weeks.
We’re going to hold off oncv a trade for this week.
I don’t like the conditions, but I have several stocks we can put on a watch list to better understand their long-term viability.
Portfolio Update
It’s been a so-so week for the portfolio, but that’s largely due to market conditions. While NVIDIA is dominating the market, there is a sharp amount of selling and a lack of buying in the underbelly.
On the options side, we lost for the first time in some months. But this is a tricky environment, and I plan to reexamine what may have signaled the time to exit. That may have been during the recent push to overbought conditions on the SPY.
With Intel Corporation (INTC), we are setting a stop in these conditions BACK at entry. So, if we find ourselves in a situation where the put spread hits $0.35, we will exit and wait for conditions to improve again.
With Occidental, we plan to buy the stock regardless of where the stock finds itself in the next week. If it does pullback, under $62.00… we would buy and add it to our portfolio. Then, we would sell covered calls on the existing stock to ensure we capture a premium that outpaces any losses that we had on the put spread trade. .
What Are Executives Buying This Week
We’re starting to see buying in energy pick up as the sector comes under pressure. We touched on the buying with Transocean and ProFrac on Wednesday. Both stocks have pulled back slightly since the executives bought shares. Dan Wilks, a 10% owner of ProFrac, added another $8 million worth of stock, as reported yesterday.
Add to the list of energy buys Sable Offshore (SOC), an independent upstream developer operating off the coast of California. Sable went public in 2021 in what looks like a SPAC deal. The company has been unprofitable for 2 of the last 3 years. On Monday, the Chairman and CEO of Sable bought 100,000 shares at $13.74 per share.
We also briefly mentioned Dorchester Minerals LP (DMLP) on Wednesday, where the CFO purchased shares. We now have an additional buy from Dorchester’s' operating partner, who helps manage the wells and properties owned by DMLP.
This transaction serves as an excellent example of why we follow insiders more than any other anomaly. These are the people who know the ins and outs of the business best. In hindsight, we can see that the CFO likely knew DMLP’s operating partner was preparing to purchase shares, so she bought first.
Dorchester is an interesting oil name that we may consider adding to the mix in the future. Be advised, the company is structured as a master limited partnership and does issue a K-1.
Three more buys that are worth a quick mention; Hims and hers, Sofi, and Traeger.
A director at Hims & Hers Health (HIMS), an online discount pharmacy, recently bought 110,000 shares at $17.74 each. This purchase seems to coincide with the news that HIMS is offering a significantly cheaper alternative to the popular weight loss drug Ozempic which contains the same ingredients but just $199 per month versus the nearly $1000 cost of Ozempic. I can tell you HIMS is a name that is starting to get thrown around quite a bit in financial publishing editorial meetings. Take that for what it’s worth.
Does it shock you to learn that the CEO of SoFi Technologies (SOFI) has been buying shares while the Biden administration forgives billions of dollars in student loans to a very small and lucky group of individuals?
For those who don’t know, SoFi is a financial app that helps college students and graduates manage their student loans. Through the app, users can refinance, access personalized financial advice, and utilize tools for budgeting and investing. That means if someone’s loan is forgiven and they use SoFi, they now have more cash or credit to utilize on the platform.
And finally, while reviewing our list of insider buys reported in the last 24 hours, one name stood out: Traeger (COOK). The company, which sells wood pellet barbecue grills, is unprofitable and not typically within our interest scope.
Then why mention it?
The other day, while listening to comedian and libertarian political pundit Dave Smith on the Joe Rogan Experience, I noticed Joe Rogan reading a commercial for Traeger. Over the years, I've heard Joe read numerous ads, for products like Athletic Greens, but this time the ad sounded more personal. It was clear to me that Joe genuinely loves his Traeger grill and was promoting it from the heart. I didn’t think much of it, assuming only that Traeger grills must be quite impressive—until I saw the insider buy this morning.
Joe Rogan averages around 11 million viewers and listeners per episode. Guests often discuss the significant boost they receive in their social media presence or support for various causes after appearing on his podcast. It will be interesting to see if this is the reason for the recent insider purchase.
Will Traeger see the 'Rogan bump'?
It’s a very fascinating opportunity… and perhaps worth some speculation. It’s just that future recessionary pressures always loom.
Stay positive,
Garrett Baldwin
