Insider buying can be a bullish indicator for a stock and provides another piece of information for investors to weigh when doing investment research. Company executives, board members, and shareholders with stakes exceeding 10% must notify the SEC within two days of their share purchases (and sales) in a Form 4 filing. Each week, I take a look at the largest insider purchases in search of investing opportunities because this is often a positive indicator.
|
Company Name |
Market Cap |
Number of Shares Purchased |
$Value Shares Purchased |
|
|---|---|---|---|---|
|
Blackrock |
$33.0 billion | 25,000 | $4.13 million | *** |
|
Solar Capital |
$805 million | 115,000 | $2.64 million | ** |
|
Hain Celestial |
$1.16 billion | 22,700 | $606,000 | *** |
|
Howard Hughes
|
$1.67 billion | 12,800 | $538,000 | ***** |
Sources: Barron's; Motley Fool CAPS.
Blackrock board member James Grosfeld bought 25,000 shares at $165.04 each, increasing his stake in the company by nearly 20%. This is the second significant purchase for Grosfeld in the past month.
Private equity entities in which the CEO and the chief operating officer of Solar Capital have a collective ownership interest bought shares in a private placement for $22.94 per share. Solar Capital, a business development company that invests in industries ranging from aerospace to health care, distributes at least 90% of its taxable earnings to shareholders so that it qualifies for a corporate income tax exemption. The stock currently yields close to 10%.
Carl Icahn continues to buy shares of Hain Celestial. With two board seats and control of 15% of the company's outstanding shares, Icahn should have leverage with the company's management, and must see opportunities for the stock price to appreciate further. Hain Celestial shares are up 59% this year, but a sale to a larger food and beverage company such as PepsiCo that has distribution muscle and a desire to expand its line of healthier snack options could generate a big payday for Icahn. Stay tuned to see how this one plays out.
Board members of real estate investment company Howard Hughes Corp. bought shares in the company, which owns properties such as the South Street Seaport in Manhattan. Howard Hughes is a spin-off from real estate investment trust General Growth Properties, which recently emerged from bankruptcy protection.
While Fools should always do their own due diligence, and not blindly follow the insiders, insider buying can point to good places to look for opportunities. To learn more about the stocks The Motley Fool is buying, click here to download a free report, "5 Stocks The Motley Fool Owns -- And You Should Too."
