Insiders at these companies are scooping up shares of their own stock lately.
Corporate insiders sell their own companies' stock for a number of reasons.
They might need the cash for a big personal purchase such as a new house or yacht, or they might need the cash to fund a charity. Sometimes they sell as part of a planned selling program that they have put in place for diversification purposes, which allows them to sell stock in stages instead of selling all at one price.
Other times they sell because they think their stock is overvalued and the risk/reward is no longer attractive. Some even dump their own stock because they have inside knowledge that a competitor is eating their lunch and stealing market share.
But insiders usually buy their own shares for one reason: They think the stock is a bargain and has tremendous upside.
The key word in that last statement is "think." Just because a corporate insider thinks his or her stock is going to trade higher, that doesn't mean it will play out that way. Insiders can have all the conviction in the world that their stock is a buy, but if the market doesn't agree with them, the stock could end up going nowhere. Also, I say "usually" because sometimes insiders are loaned money by the company to buy their own stock. Those loans are often sweetheart deals and shouldn't be viewed as organic insider buying.
Stocks with notable insider activity is something that I tweet about on a regular basis. These are also the exact type of stocks that I love to trade and alert in real-time.
At the end of the day, it's institutional money managers running big mutual funds and hedge funds that drive stock prices, not insiders. That said, many of these savvy stock operators will follow insider buying activity when they agree with the insider that the stock is undervalued and has upside potential. This is why it's so important to always be monitoring insider activity but twice as important to make sure the trend of the stock coincides with the insider buying.
Recently, a number of companies' corporate insiders have bought large amounts of stock. These insiders are finding some value in the market, which warrants a closer look at these stocks.
Alnylam Pharmaceuticals
One biopharmaceutical player that insiders are jumping into here is Alnylam Pharmaceuticals (ALNY), which discovers, develops, and commercializes novel therapeutics based on RNA interference. Insiders are buying this stock into massive weakness, since shares have plunged by 45% over the last six months.
A director just bought 27,900 shares, or about $1.03 million worth of stock, at $37 per share.
From a technical perspective, Alnylam Pharmaceuticals is currently trending below both its 50-day and 200-day moving averages, which is bearish. This stock recently gapped-down sharply lower from around $71 a share to just above $35 a share with monster downside volume flows. Following that plunge, this stock has now started to uptrend a bit, with shares moving higher off its new 52-week low of $33.16 a share to its recent high of $39.24 a share. That rebound is now quickly pushing shares of Alnylam Pharmaceuticals within range of triggering a big breakout trade above some key overhead resistance.
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If you're bullish on Alnylam Pharmaceuticals then I would look for long-biased trades as long as this stock is trending above some key near-term support levels at $35.21 to its new 52-week low of $33.16 a share and then once it breaks out above some near-term overhead resistance at $38.15 to $39.24 a share with high volume. Look for a sustained move or close above those levels with volume that registers near or above its three-month average volume of 1.13 million shares. If that breakout kicks off soon, then this stock will set up to re-fill some of its previous gap-down-day zone that started near $71 a share.
Akamai Technologies
Another technology player that insiders are in love with here is Akamai Technologies (AKAM), which provides cloud services for delivering, optimizing, and securing content and business applications over the Internet in the U.S. and internationally. Insiders are buying this stock into modest strength, since shares have risen by 10.5% over the last six months.
Akamai Technologies has a market cap of $9.9 billion and an enterprise value of $9.5 billion. This stock trades at a fair valuation, with a trailing price-to-earnings of 31 and a forward price-to-earnings of 19.9. Its estimated growth rate for this year is 2%, and for next year it's pegged at 10.9%. This is a cash-rich company, since the total cash position on its balance sheet is $868.71 million and its total debt is $628.97 million.
The CEO just bought 18,276 shares, or about $999,000 worth of stock, at $54.70 per share.
From a technical perspective, Akamai Technologies is currently trending above both its 50-day and 200-day moving averages, which is bullish. This stock has been uptrending strong over the last two months, with shares moving higher off its low of $50.76 a share to its intraday high on Wednesday of $56.98 a share. During that uptrend, this stock has been making mostly higher lows and higher highs, which is bullish technical price action. That strong uptrend has now pushed shares of Akamai Technologies within range of triggering a major breakout trade above some past overhead resistance levels.
If you're bullish on Akamai Technologies then I would look for long-biased trades as long as this stock is trending above some near-term support levels at its 20-day moving average of $54.07 a share or above its 50-day moving average of $53.48 a share and then once it breaks out above some key overhead resistance levels at $58.47 to $58.60 a share with high volume. Look for a sustained move or close above those levels with volume that hits near or above its three-month average action of 2.19 million shares. If that breakout materializes soon, then this stock will set up to re-test or possibly take out its next major overhead resistance levels at $60 to $64 a share. Any high-volume move above $64 to $65 a share will then give this stock a chance to re-fill some of its previous gap-down-day zone from last October that started near $76 a share.
Actuant
One diversified machinery player that insiders are active in here is Actuant (ATU), which designs, manufactures, and distributes a range of industrial products and systems worldwide. Insiders are buying this stock into notable weakness, since shares have dropped by 11.5% over the last six months.
From a technical perspective, Actuant is currently trending below both its 50-day and 200-day moving averages, which is bearish. This stock has just started to spike notably higher back above its 20-day moving average of $22.76 a share with decent upside volume flows. That spike is now quickly pushing shares of Actuant within range of triggering a near-term breakout trade above some key overhead resistance levels.
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If you're in the bull camp on Actuant, then I would look for long-biased trades as long as this stock is trending above some near-term support levels at $22 or at $21.66 a share and then once it breaks out above its 50-day moving average of $23.17 a share with volume that registers near or above its three-month average action of 544,226 shares. If that breakout fires off soon, then this stock will set up to re-test or possibly take out its next major overhead resistance levels at its 200-day moving average of $23.94 to $24, or even $24.85 to $26.50 a share.
Ryman Hospitality Properties
One real estate investment trust (REIT) player that insiders are jumping into here is Ryman Hospitality Properties (RHP), which owns and operates hotels in the U.S. Insiders are buying this stock into modest weakness, since shares are off by 3.5% over the last six months.
Ryman Hospitality Properties has a market cap of $2.5 billion and an enterprise value of $3.9 billion. This stock trades at a reasonable valuation, with a trailing price-to-earnings of 18 and a forward price-to-earnings of 16. Its estimated growth rate for this year is 35.2%, and for next year it's pegged at 7.5%. This is not a cash-rich company, since the total cash position on its balance sheet is $50.73 million and its total debt is $1.49 billion. This stock currently sports a divided yield of 6%.
Colin Reed,the CEO just bought 8,040 shares, or about $399,000 worth of stock, at $49.75 per share.
From a technical perspective, Ryman Hospitality Properties is currently trending above its 200-day moving average and just below its 50-day moving average, which is neutral trendwise. This stock has been uptrending over the last few weeks, with shares moving higher off its low of $47.31 a share to its recent high of $50.79 a share. During that uptrend, shares of Ryman Hospitality Properties have been consistently making higher lows and higher highs, which is bullish technical price action. That uptrend has now pushed this stock within range of triggering a near-term breakout trade above some key overhead resistance levels.
If you're bullish on Ryman Hospitality Properties, then I would look for long-biased trades as long as this stock is trending above its 200-day moving average of $49.25 a share or its 20-day moving average of $48.95 a share and then once it breaks out above its 50-day moving average of $50.78 a share to more near-term resistance levels at $51 to $52 a share with high volume. Look for a sustained move or close above those levels with volume that registers near or above its three-month average action of 288,900 shares. If that breakout hits soon, then this stock will set up to re-test or possibly take out its next major overhead resistance levels at $54 to $56, or even its 52-week high of $61.02 a share.
Lands' End
My final stock with some big insider buying is services player Lands' End (LE), which operates as a multi-channel retailer. Insiders are buying this stock into large weakness, since shares have dropped sharply by 41.9% over the last six months.
Lands' End a market cap of $475.64 million and an enterprise value of $760.39 million. This stock trades at a fair valuation, with a forward price-to-earnings of 20. Its estimated growth rate for this year is -61.1%, and for next year it's pegged at 49%. This is not a cash-rich company, since the total cash position on its balance sheet is $210.74 million and its total debt is $497.09 million.
A beneficial owner just bought 255,436 shares, or about $3.81 million worth of stock, at $14.89 per share.
From a technical perspective, Lands' End is currently trending below both its 50-day and 200-day moving averages, which is bearish. This stock has been consolidating and trending sideways over the last few weeks, with shares moving between $14.27 on the downside and $15.67 on the upside. Any high-volume move above the upper-end of its recent sideways trending chart pattern could trigger a big breakout trade for shares of Lands' End.
If you're bullish on Lands' End, then I would look for long-biased trades as long as this stock is trending above some near-term support levels at $14.27 a share or above its new 52-week low of $14.03 a share and then once it breaks out above its 20-day moving average of $15.31 a share and then above more resistance levels at $15.60 to $15.67 a share with volume that hits near or above its three-month average action of 181,012 shares. If that breakout triggers soon, then this stock will set up to re-test or possibly take out its next major overhead resistance levels at its 50-day moving average of $16.80 a share to $17.50, or even $18.50 to $19.50 a share.
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