On September 13, 2023, Saba Capital Management, L.P., a 10% owner of Blackrock CA Muni Income Tr (BFZ, Financial), purchased 61,369 shares of the company. This move is significant as it provides insight into the insider's confidence in the company's future performance.
Saba Capital Management, L.P. is an investment firm that specializes in credit strategies, including credit relative value, capital structure arbitrage, and directional credit opportunities. The firm's investment in Blackrock CA Muni Income Tr is a testament to their belief in the company's potential.
Blackrock CA Muni Income Tr is a closed-end management investment company. The Trust's investment objective is to provide current income exempt from regular federal income tax and California income tax. The Trust seeks to achieve its investment objective by investing at least 80% of its assets in municipal bonds exempt from federal and California income taxes.
Over the past year, the insider has purchased a total of 1,146,821 shares and has not sold any shares. This trend indicates a strong belief in the company's prospects and a commitment to its success.
The insider's recent purchase coincides with a positive trend in insider buying for Blackrock CA Muni Income Tr. Over the past year, there have been 17 insider buys and no insider sells. This trend suggests that those with the most intimate knowledge of the company see value in its shares.
On the day of the insider's recent purchase, shares of Blackrock CA Muni Income Tr were trading at $10.98, giving the company a market cap of $333.058 million.
According to GuruFocus Value, the stock is modestly undervalued with a price-to-GF-Value ratio of 0.73. The GF Value of $15.06 is based on historical multiples, a GuruFocus adjustment factor, and future business performance estimates from Morningstar analysts.
The insider's decision to increase their stake in Blackrock CA Muni Income Tr at this time could be a strategic move based on the stock's current undervaluation. It's a strong signal that the insider believes the stock's intrinsic value is higher than its current market price, indicating potential for future price appreciation.
In conclusion, the insider's recent purchase of Blackrock CA Muni Income Tr shares, coupled with the positive insider buying trend and the stock's current undervaluation, presents a compelling case for potential investors. As always, investors should conduct their own due diligence before making investment decisions.
