One's dignity may be assaulted, vandalized and cruelly mocked, but it can never be taken away unless it is surrendered.” ― Michael J. Fox
We continue a new weekly feature today. Every week we will be providing very brief overviews of five interesting stocks insiders are currently buying. I have always found insider buying one of best indicators that a stock may be undervalued.
In fact, insider buying was a great 'tell' that the market had gotten oversold during the fourth quarter sell-off. Insider buying hit a eight-year high in December. It is also a key reason the model portfolio at The Insiders Forum has smoked the performance of Russell 2000 (58.75% to 31.20%) since its launch in July 2016 as of the market close Friday.
Here are five stocks that look interesting and that have had recent insider buying.
Goodyear Tire & Rubber (GT) shares have been under pressure of late. The company delivered a weak fourth quarter that missed expectations early in February. The company has negative sales growth overseas and was particularly pressured in Asia were revenues were down some 11% on a year-over-year basis. However, at approximately nine times earnings with an over three percent yield, there is some value in the shares. At least one insider thinks so evidently as a director bought just over $650,000 in shares on February 13th. It was the first insider buy in the stock in over two and a half years. We will posting a 'deep dive' on GT exclusively to Insider Forum members this Tuesday.
A director at Plantronics (PLT) has picked up over a $1 million in news shares in several dozen small transactions on February 12th. Another director bought $75,000 worth of shares a week later. It is the first new insider buys in several years. Plantronics recent Q4 results exceeded expectations on February 6th. The stock sells for just ten times forward earnings and yield a bit over one percent. The stock has been a strong performer so far in 2019, but has still not recovered fully from its swoon in the back half of 2018.
Seattle based real estate services company Redfin (RDFN) sees its first insider buy since coming public back in the summer of 2017. After myriad insider sells over that time frame, its CEO becomes the first insider to make a purchase in the public shares. He added approximately $500,000 to his core holdings on February 19th. As can be seen above, the online real estate service company has seen rapid growth in recent years.
Telenav (TNAV), a San Jose based provider of connected car and location-based platform services is next up. A director and beneficial owner added more than $800,000 to his core holdings in four transactions from February 12th to February 15th. The company beat on top and bottom line expectations when it delivered Q4 results on February 7th. Some of the highlights from that earnings report and posted above.
Finally, we have a small insider buy in Array Biopharma (ARRY) which trades near 52-week highs. A director picked up $115,000 in new shares on February 19th. This stock has seen almost exclusively insider sells over the past 11 quarters. The only insider buy in that time was from the same director who made a $50,000 buy on November 1st. The stock is up some 40% over that time. The only heavy insider buying in these shares in recent memory happened in the first and third quarters of 2016. This were well timed purchases as the stock in up over 500% since then.
And those are five stocks seeing significant recent insider buying for consideration.
Dignity does not consist in possessing honors, but in the consciousness that we deserve them.” ― Aristotle
Thank You & Happy Hunting,
Bret Jensen
Founder, The Biotech Forum, The Busted IPO Forum & The Insiders Forum
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