Continental Resources Inc. on June 29 unveiled that its founder, Harold Hamm, increased his holdings in the company through a recent purchase of shares on the open market.
In a statement, Hamm, who currently serves as Continental’s executive chairman, said the purchases underscored his confidence in the company, the value of which he believes is currently undervalued due to the COVID-19 pandemic.
“I firmly believe Continental’s current share price reflects an uncommon value as the global pandemic has negatively impacted worldwide crude oil demand,” he said.
Continental Resources is the largest leaseholder and the largest producer in the Bakken oil play of North Dakota and Montana, according to a release from the company. The Oklahoma City-based independent oil producer also has significant positions in the SCOOP and STACK shale plays in Oklahoma.
The price of Continental’s stock closed at about $16.19 per share on June 30—almost half the price its shares were trading at the start of the year.
Hamm purchased about 4.7 million shares of Continental stock on the open market from June 22-June 25 at market prices. As of June 25, Hamm held about 289.7 million shares or approximately 79.3% of the company’s total outstanding shares.
Further, Hamm entered into a 10b5-1 plan on June 25 to acquire additional shares of Continental stock.
Rule 10b5-1, established by the U.S. Securities and Exchange Commission (SEC) in 2000, allows insiders of publicly traded corporations to set up a trading plan for selling stocks they own. Many corporate executives use 10b5-1 plans under the to avoid accusations of insider trading, according to Investopedia.
Hamm launched Continental Resources more than 50 years ago and previously had served as its chairman and CEO. At the start of 2020, however, he stepped into a new role at the company as part of a leadership transition that saw William Berry, a former ConocoPhillips Co. exec, taking the reins as Continental CEO.