With earnings season coming to an end, there's bound to be a few reporting companies that'll blow away analyst expectations. But how do you identify the companies that might report significant earnings surprises?
One way is to look at what insider executives are doing -- if they are using their own money to buy the shares of their employers, it may signal that they think earnings estimates are too pessimistic.
To compile this list, we started with a universe of about 200 companies reporting earnings next week.
We then collected data on insider transactions, and identified the companies that have had the largest increases in insider ownership over the last six months.
These insiders seem to think their companies are being underestimated -- will upcoming earnings result reflect insider optimism?
List sorted by the change in insider ownership. Insider trading data sourced from Yahoo! Finance. (Click here to access free, interactive tools to analyze these ideas.)
1. Myrexis (Nasdaq: MYRX ) : The stock has returned -26.76% over the last year. Over the last six months, insider executives were net buyers of 189,900 shares, which represents about 0.78% of the company's float of 24.29M shares. The company is set to report earnings on 08/31.
2. Prospect Capital (Nasdaq: PSEC ) : The stock has returned 3.% over the last year. Over the last six months, insider executives were net buyers of 128,266 shares, which represents about 0.13% of the company's float of 96.25M shares. The company is set to report earnings on 08/29.
3. Dynavox (Nasdaq: DVOX ) : The stock has returned -59.45% over the last year. Over the last six months, insider executives were net buyers of 55,000 shares, which represents about 0.59% of the company's float of 9.30M shares. The company is set to report earnings on 08/31.
4. SWS Group (NYSE: SWS ) : The stock has returned -39.44% over the last year. Over the last six months, insider executives were net buyers of 11,000 shares, which represents about 0.04% of the company's float of 27.32M shares. The company is set to report earnings on 08/30.
5. First Clover Leaf Financial (Nasdaq: FCLF ) : The stock has returned 27.02% over the last year. Over the last six months, insider executives were net buyers of 4,172 shares, which represents about 0.07% of the company's float of 6.31M shares. The company is set to report earnings on 08/31.
Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the stocks mentioned above. Analyst ratings sourced from Zacks Investment Research.
Kapitall's Eben Esterhuizen does not own any of the shares mentioned above.
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