The CAPS Screen: 5 Top-Rated Insider-Owned Stocks

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At The Motley Fool, we like companies with a high level of insider ownership. We believe that leaders with large ownership stakes in their companies will have a greater incentive to do what's best for the business. The record appears to bear this theory out, since such companies tend to outperform.

Compare the performance of Garmin (Nasdaq: GRMN) (41% insider-owned) to that of golden-parachute-burdened Home Depot (NYSE: HD) (1% insider-owned). One has been a double over the past five years, while the other has done ... not so well. I’ll let you guess which is which.

With all of this in mind, I used our new CAPS screening tool to look for companies with high insider ownership. Below, you'll find five companies whose insiders hold at least 20% of shares.

They also have:

  • Market caps greater than $150 million.
  • Five-star ratings, the highest possible, from our CAPS community.

Remember, in the first year for which we have data, five-star companies outperformed with an average return of nearly 28%.

Company

Share Price

Sector

Market Cap

Fuel Tech (Nasdaq: FTEK)

$24.13

Industrial Goods

$542 million

IPG Photonics (Nasdaq: IPGP)

$18.41

Technology

$815 million

Navios Maritime (NYSE: NM)

$10.28

Services

$1.1 billion

Steel Dynamics (Nasdaq: STLD)

$37.77

Basic Materials

$7.1 billion

ShengaTech (Nasdaq: SDTH)                           

$7.74

Basic Materials

$419 million

Data from Motley Fool CAPS and Yahoo! Finance as of June 10.

Of course, this screen is only a starting point in the research process. Come and join us on Motley Fool CAPS to dig into these companies further. Let our 105,000-strong (and counting) CAPS community help you make better stock selections.

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Ilan Moscovitz doesn't own any of the companies mentioned in this article. Garmin is a Motley Fool Stock Advisor and Global Gains recommendation. Home Depot is an Inside Value selection. IPG Photonics is a Rule Breakers selection. The Motley Fool also owns shares of IPG Photonics. The Motley Fool’s disclosure policy parties like it’s 1999.

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Fuel Tech, Inc.

CAPS Rating 4/5 Stars

$8.16

-0.13 (-1.57%)

Outperform995

Underperform33

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