Stocks the Rich Executives Are Buying

Put five Fools in a room, ask them how they invest, and you'll likely get five different answers. Yet while our styles differ, we all want excellent, engaged managers running the companies we own -- all the more so if they're willing to invest in their own shares, even in trying times like these.

The week's buying
So which rich executives are buying now? Here's what our friends at Form 4 Oracle say:

Company

Closing Price 4/22/09

Total Value Purchased

52-Week Change

Charming Shoppes (Nasdaq: CHRS  )

$2.86

$36,130

(36.6%)

Hansen Medical (Nasdaq: HNSN  )

$3.99

$3,550,011

(75.7%)

Suffolk Bancorp (Nasdaq: SUBK  )

$25.81

$110,630

(17.2%)

The Greenbrier Companies (NYSE: GBX  )

$7.40

$640,812

(66.8%)

Valeant Pharmaceuticals (NYSE: VRX  )

$17.50

$30,006

33.2%

Sources: Fool.com, Yahoo! Finance, Form 4 Oracle.

Another intuitively obvious buy?
You've heard it from us before. If you're going to swing for the fences in your investing, you'll strike out from time to time. We've certainly had our share of misses at Motley Fool Rule Breakers. For a time, Hansen Medical seemed like one.

But is it? Huge insider buys over the past week suggest otherwise. Five separate executives and board members poured more than $3.5 million into the company, including a $300,000 cash commitment from CEO and co-founder Dr. Frederic Moll.

Moll, also a co-founder of Intuitive Surgical (Nasdaq: ISRG  ) , has a lot to lose if Hansen fails. He was the company's single largest shareholder even before this latest purchase, according to Capital IQ.

But there's a catch. Hansen yesterday closed a follow-on offering of 11.7 million shares that's expected to net $35.1 million in proceeds net of expenses. A portion of the buying came from board members who participated in the offering.

Still, I'm impressed that they're buying at all. The recession has forced capital spending cuts at hospital administrators such as Tenet Healthcare (NYSE: THC  ) . Why is that bad news? Like Intuitive, Hansen's robotic systems are big-ticket items that promise to improve treatment. Cut capital spending, and you cut the budget needed to spend on Hansen's products.

Yet our 130,000-strong Motley Fool CAPS community, on the whole, still likes the stock:

Metric

Hansen Medical

CAPS stars (5 max)

****

Total ratings

467

Percent Bulls

95.5%

Percent Bears

4.5%

Bullish pitches

87 of 95

Data current as of April 22, 2009.

"The robotic catheter system is currently being used for endovascular procedures. This is a growth industry, but the more exciting prospect is the newer applications of this technology in other fields," wrote CAPS investor fburks last September, continuing:

A recent article in Urology highlighted an animal study using the robotic catheter system in the ureter for treatment of kidney stones and other conditions. I also think this technology will have great application for NOTES (Natural Orifice Transluminal Endoscopic Surgery) or incisionless surgery. Intuitive' robotic system got a slow start in vascular and heart procedures, but took off once it was applied in the field of urology. I would expect the same to happen to HNSN's robotic system.

In other words: Hansen just needs time to make good on its promise. Insiders would appear to agree.

There's your update. See you back here next week, when we dig through more insider filings in search of the next home run stock.

Get the inside scoop on stocks of all sizes:

Hansen Medical and Intuitive Surgical are Motley Fool Rule Breakers picks. Discover our full list of hot growth stock ideas with a free 30-day trial.

Fool contributor Tim Beyers is slowly improving his CAPS score. Thankfully, he's doing better as a Rule Breakers analyst. Tim didn't own shares in any of the companies mentioned in this article at the time of publication. Check out his portfolio holdings and Foolish writings, or connect with him on Twitter as @milehighfool.

The Motley Fool is also on Twitter as @TheMotleyFool. Its disclosure policy knew a rich executive once. She never bought anything.


Read/Post Comments (1) | Recommend This Article (10)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Add your comment.

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 882545, ~/Articles/ArticleHandler.aspx, 10/22/2014 8:45:49 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...


Advertisement