Michael McCaul, a Republican U.S. representative for Texas's 10th congressional district since 2005, made notable trades in the month of February in the stock market. As per his regulatory disclosure reported on March 23 on Capitol Trades, McCaul purchased shares of three companies in mid-February: ConocoPhillips (COP:US), Arista Networks (ANET:US), and PayPal Holdings (PYPL:US).
Analyzing the data from TipRanks, we can examine the performance of these stocks since Mr. McCaul made his purchases and can gain insights into their future prospects.
ConocoPhillips is an American oil and gas company involved in hydrocarbon exploration and production. Year-to-date till March 24, COP stock dropped down nearly 14.5%, mainly due to the banking sector turmoil, which resulted in lower oil prices. The Republican acquired COP stock on February 13, with an investment range of $100,000 - $250,000. Unfortunately, since the lawmaker's investment, COP stock has experienced a loss of nearly 9%.
Despite the downturn, TipRanks' analysis in late March revealed a strong buy consensus rating for COP stock, based on 12 Buy ratings and four Hold ratings. The average price forecast for ConocoPhillips was $139.20, suggesting a potential upside of almost 44.4% from the levels on March end.
Notably, three corporate insiders showed a positive signal by purchasing COP stock worth around $1.2 million in the first quarter of 2023. However, hedge funds had been avoiding the stock due to concerns about excess inventory and a potential recession in the oil and gas sector.
During the last quarter, 23 hedge funds sold nearly 7.2 million shares of ConocoPhillips, giving it a very negative signal on TipRanks. Nevertheless, COP stock maintained an outperform smart Score of eight, supported by increasing purchases from retail investors and overall bullish opinions from bloggers.
Arista Networks is an American computer networking company. ANET stock surged by almost 45% in 2023, driven by better-than-expected Q4 FY22 results and solid revenue forecasts. McCaul acquired ANET stock on February 10, just before its earnings report, with an investment range of $50,000 - $100,000. Since the purchase, ANET stock has gained almost 22%.
TipRanks' Outperform Smart Score of nine supported the positive performance of ANET stock. Retail investors displayed high optimism, increasing their holdings by 6.8% in the month of March.
Wall Street analysts also held a Strong Buy consensus rating for Arista Networks, based on 12 Buy ratings and four Hold ratings. The average price target for ANET was $170.67, indicating that shares were priced near their full value at the end of March 2023.
PayPal Holdings, an American fintech company operating an online payment system, faced challenges in 2023, with a decline of nearly 2.7% year-to-date attributed to the banking crisis and contagion fears. Mr. McCaul purchased PYPL shares in the range of $50,000 - $100,000 on February 14, after the company reported solid Q4 FY22 results. However, since his purchase, PYPL stock has declined by over 17%.
While corporate insiders remained positive and bought PYPL shares worth around $2 million in the fir three months of 2023, both retail investors and hedge funds witnessed reducing their exposure to the stock. In the month of March, TipRanks' data shows a nearly 1.9% reduction in PYPL stock holdings by stock investors, and 51 hedge funds sold almost 16.2 million shares in the last quarter.
Analysts held a Moderate Buy consensus rating for PayPal, with 17 Buy ratings, eight Hold ratings, and one Sell rating. The average price target for PayPal Holdings was $111.29 at the end of March, suggesting an upside potential of almost 53.4%.