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Shares of Dynegy Inc. Jump 14% After CEO Picks Up Additional Shares

By Daniel Miller – Mar 2, 2016 at 5:39PM

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As many investors hear time and time again, insiders may sell for many reasons but only buy for one: They think the price is moving higher. That's helping Dynegy's stock price on Wednesday.

Image source: Dynegy.

What: Shares of Dynegy (NYSE: DYN), an energy company that operates power-generating facilities in eight states in the Midwest, Northeast, and on the West Coast, are rising Wednesday after insider buying sent a bullish signal to investors.

So what: After what's been a brutal 12 months for the company's stock price, the company's president and chief executive officer, Robert C. Flexon, acquired 10,000 shares Tuesday at price per share of $10.08. That amount increased Flexon's total to more than 436,000 shares.

Furthermore, a couple of institutional investors jumped on board during the fourth quarter, with TFS Capital LLC purchasing 137,532 shares and ClariVest Asset Management LLC adding another 22,600 shares to its pile that now totals 52,000 shares. That was just the latest in multiple insider buys at Dynegy. On Dec. 10, 2015, Director Patrick Wood purchased 6,400 shares at $11.61, and in mid-November Flexon and EVP Daniel Thompson purchased 10,000 shares and 1,000 shares, respectively, at $16.70 and $17.55 per share.

DYN Chart
DYN data by YCharts.

Now what: When insiders and institutional investors continue to buy in groups, like has recently happened at Dynegy, it sends a bullish signal to investors. It's been a brutal past 12 months for the stock price and investors appear to be jumping on board after insider buying and a recent upgrade by analysts at Guggenheim suggest the price has bottomed out.

Daniel Miller has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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