Insider buying can be a bullish indicator for a stock and provides another piece of information for investors to weigh when doing 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 some of the largest insider purchases in search of opportunities with this often-positive indicator.
|
Company Name |
Market Cap |
Number of Shares Purchased |
$ Value Shares Purchased |
CAPS Rating (out of 5) |
|---|---|---|---|---|
|
American Superconductor
|
$1.32 billion |
146,000 |
$4.22 million |
** |
|
Medtronic |
$39.8 billion |
100,000 |
$3.71 million |
**** |
|
Starwood Property Trust |
$1.03 billion |
30,000 |
$642,000 |
**** |
Sources: Barron’s; Motley Fool CAPS; SEC filings.
American Superconductor investor Kevin Douglas bought shares of the company for $28.87 per share. Douglas has been buying a sizeable number of shares of the company throughout 2010. American Superconductor designs wind turbines and provides systems that connect wind farms to the electric power grid. The company’s stock price has fallen in recent months, as investors have grown concerned about the company’s reliance on a single Chinese wind turbine manufacturer, Sinovel Wind Group, for its revenues. Based on his buying, Mr. Douglas does not share these concerns.
Medtronic director Jack Schuler bought shares of the medical device company at an average price of $37.06 per share. Medtronic’s stock wasn’t a winner for investors in 2010, but Schuler, who serves on the boards of several other healthcare companies, must expect a better 2011 for the company.
Board member Jeffrey Dishner bought shares of Starwood Property Trust at $21.41 per share. The commercial real estate REIT currently yields 7.5%, and recently raised capital, selling shares for $19.73 each.
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, download our free report, 5 Stocks The Motley Fool Owns - - And You Should Too.
