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Recent Insider Buying Offers Tips
Posted: Nov 12, 2009 15:09 PM by Aryeh Katz
The following issues have seen significant recent insider stock purchases over the last week. Insider buying is understood by many to be a good indicator for would-be investors in a stock to seize upon. While the selling of a stock might occur for a myriad of reasons, those who buy their own company's shares do so only for the sake of a profit. Below are five such companies, along with their respective insiders' details.
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On November 9, Lynn Eisenhans, the CEO and president of Sunoco, Inc. (NYSE:SUN), put up $282,000 of her own money to purchase her company's shares. Sunoco refines and sells crude oil and related petroleum and petrochemical products in the eastern and northeastern United States. Eisenhans's purchase was made just days after the company reported weaker than expected quarterly earnings and the share price dropped roughly 10%.
SUN shares trade with a P/E of 10.5 and yield of 4.30%. Price to book for the stock is exactly 1.00.
A Noble Purchase
Noble Energy, Inc. (NYSE:NBL) is another energy outfit that saw significant insider activity last week. On November 6, company Director William T. Van Kleef spent $665,000 on NBL stock.
Despite a weaker third-quarter profit (analysts had expected 82 cents per share, while the company delivered only 61) NBL gets Standard & Poor's positive four star (out of five) buy rating. The company offers a nominal 1% annual dividend and the shares are up roughly 90% since 52-week lows set a year ago.
NRG Energy, Inc. (NYSE:NRG) is a wholesaler of energy to marketers across the United States and abroad. The company's current stable of 48 power generation plants, including two wind farms, produce 24,000 megawatts of energy. In the last week, three insiders purchased a total of 8,500 shares for a total of roughly $200,000.
NRG stock trades with a P/E of 7.7 and a price/sales ratio of 0.9. Price to book is also 0.9.
Synchronized Buying
Synovus Financial Corp. (NYSE:SNV) saw some very active buying in the last week by the company's CFO and one director, and steady buying from seven separate corporate insiders since September 22. The total number of shares purchased over that period was 162,500 with an average cost of roughly $3.00, for a total of approximately $488,000.
Synovus stock yields 2% annually.
Acco Brands Corporation (NYSE:ABD) is up 900% since February - it's no wonder insiders have been buying. In the last week, four separate insiders purchased 34,500 shares at an average cost of roughly $6.15, for a total collective outlay of approximately $205,000. But insider purchases in the stock have been steady and large for the past year.
Acco Brands is in the office supply business.
The Bottom Line
Investors need to sift carefully, no doubt, but a rash of insider buying on a stock is very often a clue to that company's prospects. Combined with sturdy fundamentals, insider purchases often provide the final proof for a stock purchase decision. (To learn more, see Delving Into Insider Investments.)
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