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 |
Market Cap |
Number of Shares Purchased |
Dollar Value of Shares Purchased |
CAPS Rating (out of 5) |
|---|---|---|---|---|
|
MannKind
|
$1.02 billion |
700,000 |
$5.75 million |
** |
|
Hain Celestial Group
|
$1.11 billion |
32,000 |
$881,000 |
*** |
|
Winmark
|
$166 million |
5,000 |
$162,000 |
** |
|
Red Robin Gourmet Burgers |
$348 million |
4,894 |
$106,000 |
** |
Sources: Barron's and Motley Fool CAPS.
MannKind and Hain Celestial make yet another appearance in this week's insider buying column. MannKind founder and CEO Alfred Mann continues to put his money where his mouth is in a big way, as his company waits for an FDA decision on its inhalable diabetes drug, Afrezza. Meanwhile, investment partnerships controlled by activist investor Carl Icahn continue to build their stake in natural foods purveyor Hain Celestial. I predict 2011 will be an eventful year for both stocks.
The CEO of Winmark -- which franchises the retail consignment store concepts Play It Again Sports, Plato's Closet, and Once Upon A Child -- bought shares for $32.43 each. Two other executives at the company recently bought smaller amounts of stock for family members.
Funds managed by Kovitz Investment Group bought more shares of Red Robin Gourmet Burgers. In partnership with Oak Street Capital, Kovitz has acquired more than 10% of Red Robin's shares. Fool colleague Jim Royal also sees opportunity for the struggling restaurant to succeed with its turnaround or get bought out, and he's purchased shares for his Rising Stars portfolio.
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."
