AngioDynamics, Inc. (ANGO): Why You Should Pay Attention to Insider Buying

Two insiders at AngioDynamics, Inc. (NASDAQ:ANOG), including President and CEO James C. Clemmer, have bought shares of the company in the past week following a bout of weakness. Mr. Clemmer purchased 25,000 shares in total through transactions made on July 20 and 21, lifting his ownership stake to 91,683 shares. Meanwhile, Independent Chairman of the Board Howard W. Donnelly purchased 5,000 shares on July 21, lifting his ownership position to 47,600 shares.

The purchases are particularly notable given the fact that they’re the first made by executives of the company in more than three years. And it’s not as if shares were flying high during that time, which could otherwise have explained the lack of buying; shares of AngioDynamics, Inc. (NASDAQ:ANGO) tanked by over 40% in 2015, yet insiders kept their purse strings cinched. The purchases by the CEO are also the first since he took the reins of the company last April, while Mr. Donnelly’s purchase was his first in eight years

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The insider buying comes shortly after shares of AngioDynamics, Inc. (NASDAQ:ANGO) slumped by 7% on July 18, the same day the company’s fiscal fourth-quarter financial results were released. Adjusted earnings of $0.19 per share beat estimates by $0.03, while net sales came in at $86.9 million, down by 7% from a year earlier and missing estimates by $4.1 million.

However, it was a year of transition for the company, which turned to Mr. Clemmer’s decades of experience in the medical device industry after a trying 2015. Mr. Clemmer continues to work to consolidate AngioDynamics’ operations, with plans to close plants in Georgia and the United Kingdom.

Going against the grain of trying to artificially inflate shares through dividends and buybacks, Mr. Clemmer plans to instead reinvest $5 million in profit back into the company, strengthening its R&D and workforce training capabilities. The company generated $18.3 million in free cash flow during its fiscal fourth-quarter and expects $35 million in free cash flow during its 2018 fiscal year.

It was revealed in an SEC filing on July 17 that AngioDynamics’ auditor PricewaterhouseCoopers LLP found a material weakness in the internal controls over financial reporting that were in place at the company as of its May 31, 2016 financial statement, though it did not result in the company’s financial statements needing to be altered. AngioDynamics has said that the material weakness has since been addressed. It does not appear that the revelation was the cause of the decline in shares on the following day.

That decline was short-lived, as shares have jumped by 7% today, pushing them to a 3-month high, possibly due to the confidence shown in them by the aforementioned executives of the company. Mr. Klemmer is particularly excited about the company’s NanoKnife device to treat pancreatic cancer, which he believes would be making a huge splash based on its successful results, if only it came in pill form.

Hedge funds are also growing increasingly bullish on AngioDynamics, Inc. (NASDAQ:ANGO), with 23 funds in our database long the stock at the end of March, nearly double the 12 funds that were shareholders of it nine months earlier. Those 23 funds own 13.2% of the company’s shares

By Tim Frederick

Source: https://goo.gl/eqHxuY

Also Read: 

Top 75 Healthcare Dividend Stocks To Invest In : https://goo.gl/pWB9UV

One Insider Just Bought $6.5 Million Worth of This Restaurant Player

Company insiders will sell their own stock for all sorts of reasons. They might need cash for a fancy new car, a large tax bill or simply for diversification purposes.

Insiders, however, usually buy their own shares for one reason only: They think the stock is undervalued with tremendous upside.

Recently, a number of companies' corporate insiders have been loading up on stock. These insiders see value, which warrants a closer look at these names.

Intel Corporation

One semiconductor player that insiders are active in right now is Intel Corporation (INTC) , which designs, manufactures and sells computer, networking and communications platforms worldwide.

Intel has a market cap of $167 billion. This stock trades at a fair valuation, with a forward price-to-earnings ratio of 11.9 times. Its estimated growth rate for this year is 5.10%, and for next year it's pegged at 3.80%. This is not a cash-rich company, since its total cash position is $17.29 billion, and its total debt is $25.75 billion.

The CFO bought 13,888 shares, or $504,000 worth of stock, at $36.30 per share.

If you're bullish on INTC, I would look for long-biased trades if this stock is trending above some near-term support at $35 or at $34.40, and then once it breaks out above resistance levels at $36.60 to $37.22 with volume near or above its three-month average of 21.24 million shares. Some possible upside targets off that breakout are its 52-week high of $38.45 to $40 a share.

Tempur Sealy International Inc.

Another consumer goods player that insiders are jumping into here is Tempur Sealy International Inc. (TPX) , which develops, manufactures, markets and distributes bedding products worldwide.

Tempur Sealy has a market cap of $2.66 billion. This stock trades at a fair valuation, with a forward price-to-earnings of 13.9 times. Its estimated growth rate for this year is -20%, and for next year it's pegged at 9.6%. This is not a cash-rich company, since its total cash position is $42.5 million and its total debt is $1.86 billion.

A director just bought 100,000 shares, or $4.73 million worth of stock, at $47.37 per share.

If you're bullish on TPX, I would look for long-biased trades if this stock is trending above its 50-day at $46.44 or above $45, and then once it breaks out above some key resistance levels at $51.50 to $51.60 with volume near or above its three-month average of 1.25 million shares. If that breakout hits soon, then this stock will set up to refill some of its previous gap-down-day zone from January that started near $66 a share.

Fiesta Restaurant Group Inc.

One restaurants player that insiders are active in here is Fiesta Restaurant Group Inc. (FRGI) , which owns, operates and franchises fast-casual restaurants.

Fiesta Restaurant Group has a market cap of 584 million. The stock trades at a fair valuation with a forward price-to-earnings of 17.7 times. Its estimated growth rate for this year is -11.6%, and for next year it's pegged at 7%. This is not a cash-rich company, since its total cash position is $7.71 million, and its total debt is $76.15 million.

A director just bought 309,115 shares, or $6.52 million worth of stock, at $21.06 to $21.25 per share.

If you're in the bull camp on FRGI, I would look for long-biased trades if this stock is trending above some near-term support at $20.65 and once it breaks out above a key downtrend line that will trigger over $22.20 to $22.85, and $23.85 with volume near or above its three-month average of 449,612 shares. Some possible upside targets off that breakout are its 200-day at $25.55 to $28, or even $30 a share.

Revlon Inc.

Another consumer goods player that insiders are in love with here is Revlon Inc. (REV) , which manufactures, markets and sells beauty and personal care products worldwide.

Revlon has a market cap of $1.1 billion. This stock trades at a reasonable valuation, with a price-to-sales of 0.44 times. This is not a cash-rich company, since its total cash position is $121.50 million, and its total debt is $2.73 billion.

A director just bought 347,028 shares, or $6.79 million worth of stock, at $19.01 to $20.16 per share.

If you're bullish on REV, I would look for long-biased trades if this stock is trending above its 20-day at $19.40, and then once it breaks out above some resistance levels at $21.25 to $21.45, and over its 50-day at $22.48 with volume near or above its three-month average of 227,604 shares. If that breakout hits soon, then this stock will set up to refill some of its previous gap-down-day zone from May that started near $26 a share.

SeaWorld Entertainment Inc.




My final stock with some large insider buying is services player SeaWorld Entertainment Inc. (SEAS) , which operates as a theme park and entertainment company in the U.S.

SeaWorld Entertainment has a market cap of $1.55 billion. This stock trades at a reasonable valuation, with a forward price-to-earnings 17.7 times. Its estimated growth rate for this year is 31.4%, and for next year it's pegged at 43.3%. This is not a cash-rich company, since its total cash position is $33.22 million, and its total debt is $1.63 billion.

A beneficial owner just bought 170,000 shares, or $2.93 million worth of stock, at $17.26 per share.

If you're bullish on SEAS, I would look for long-biased trades if this stock is trending above its recent low of $15.81 and then once it breaks out above resistance levels at $17.15 to its 20-day at $17.47 with volume near or above its three-month average of 1.77 million shares. Some possible upside targets off that breakout are $18.60 to $19.25, or even its 52-week high of $20.13 a share.
Read More: One Insider Just Bought $65 Million Worth of This Expensive Biotech Stock

By Roberto Pedone

Source: https://goo.gl/1QYhDc

When "Insider" Greed Is Good

Not all insider buys are made equal. But when you focus on the right ones, the reward can be tremendous.

What do Elon Musk and Mary Dillon have in common?

Both are CEOs who have bought shares of their own companies just before the share prices moved higher.

You have probably heard of Elon Musk, the CEO of Tesla. In 2013, he made a big statement by buying over a million shares of Tesla stock for $100 million even though he already had plenty of shares.

Musk went out on the limb even further, as he had to borrow the money from Goldman Sachs to buy the shares. He used his previous holdings in Tesla, and stakes in other companies, as collateral. Since then, shares of Tesla are up over 100%.

But who is Mary Dillon?

She's the President and CEO of Ulta Beauty, a cosmetics and beauty product retailer with stores across the United States.

The CEO of Ulta bought nearly a million dollars worth of shares on the open market in March 2014 and September 2014.

Since the March 2014 purchase, shares are up 175%.

Clearly it is beneficial for investors to follow insider buying activity. Digging below the surface to find the obscure purchases by folks like Mary Dillon is where the big rewards can be found.

Insider Buying Sends a Strong Signal

Why would these two CEOs spend so much of their money on their own companies' stock when they already own a ton shares already?

Greed!

Pure and simple.

The opportunity to make more money motivates people - even people who are already billionaires like Elon Musk.

If top insiders are buying, it's because they know something very good is going on at the company. Maybe it is a new product. Or contract. Or pending merger.

Whatever the reason, they are very confident that shares will be on the rise. After all, who would buy more stock in a company if they knew it was sinking???

Massive Insider Opportunity Ends Sunday

Just a few days ago, key insiders suddenly poured over $10 million of their own money into shares of their market-leading retail company. They already receive stock options as part of their compensation, but they're scooping up even more on the open market. This kind of "insider buy" can only mean one thing:

Those "in-the-know" expect a major price jump.

Don't miss your chance to make the most of this and a selection of other compelling opportunities. Check Zacks' insider portfolio before it closes to public entry midnight - Sunday, February 19.

See insider trades now >>

Buy When the Insiders Buy

When high level insiders buy, they are required to report the purchases to the SEC within 48 hours of the trade. The trade then becomes public information.

Hedge funds and other professional investors routinely use this information to get an edge on their trades.

For most of us, though, it's not easy to get access to the insider information. While the media will tout huge insider buys like Elon Musk's $100 million purchase, did you hear anything about Mary Dillon's $475,000 purchase in September 2014?

More recently, the top insiders have continued to buy. But did they report it on the front page when Charles Swoboda, CEO of Cree, bought 10,000 shares in October 2016? Of course not. Yet Cree is up 16% since that purchase.

The challenge is getting easy and reliable access to all the insider trades and then figuring out which ones to buy.

Where to Find the Insider Buys

Anyone can go on the SEC website and get the insider trading information, but it's time consuming to search by individual companies.

Some investment firms collect the insider buying data and can provide it to you as a weekly list. Have you ever seen one of those lists? The sheer number of companies can be overwhelming.

In some instances, the insiders have been known to buy en masse. Then what's an investor to do?

This happened during the stock market dip in August 2011. As stock prices fell, insiders felt that their companies were undervalued and rushed out to buy shares.

That August, insiders bought stock in 50 different S&P 500 companies in just one week. Even if you got a list of those stocks, how would you narrow it down to the stocks that were truly worth buying?

Why You Should Dump Your Hedge Funds

Hedge funds are much better investors than you are made to believe by the financial press. Even hedge fund indices hide the truth about hedge funds’ amazing talent in picking winners and losers. Our research has shown that hedge funds’ top small-cap picks outperformed the market by nearly a percentage point per month between 1999 and 2012. We launched an investment newsletter that shares the stock picks of this strategy in real-time. This strategy returned 131.4% between the end of August 2012 and February, 2015. S&P 500 ETF (SPY) gained only 57.2% during the same period. Hedge funds’ top stock picks significantly outperformed the market.

However our advice to you is to dump your hedge funds.

The fact is that most hedge fund investors don’t make as much money as they did in the nineties and the first half of the past decade, where alpha in excess of 10% was the norm. Aggregately speaking, hedge funds’ alpha has been in decline over the past decade for several reasons. They are as follows:

1) A greater level of competition within the hedge fund industry has caused profit margins to shrink.

2) Hedge funds got bigger and started investing in less profitable areas.

3) There are a lot of unskilled hedge fund managers who are trying to get rich by being “lucky”.

4) Equity hedge funds charge an arm and a leg for beta exposure.

Our research has shown that hedge funds have a small edge when it comes to large-cap stock picks and a large edge when it comes to small-cap stock picks. We created a 50-stock portfolio of the most popular large-cap stocks among fund managers. Between 1999 and 2012, this 50-stock portfolio underperformed the market by less than 1 percentage point per year but its annual alpha was 0.7 percentage points (read the details here).

It should be clear to you, then, that hedge funds’ large-cap stock picks are marginally better than the S&P 500 index because of their lower risk profile. However, if you are a hedge fund client you won’t see much outperformance in this space because you have to surrender 2% of your assets and 20% of each year’s return to your hedge fund manager. If your hedge fund invested entirely in large-cap stocks in 2014, its gross return would have been 13.5% but YOUR net return would have been only 8.8%, because you have to pay 2 percent flat fee and 2.7 percentage points of performance fee as if they accomplished something significant!!

Hedge funds can’t generate enough alpha in the large-cap space to justify their high fees. They invest in the large caps because they have too much money to manage, and they don’t want to give up juicy management fees that enable them buy condos on New York City’s Park Avenue. How do hedge fund managers get away with this?

The answer is simple.

They generate significantly higher alpha in their small-cap stock investments. Generally speaking, there are fewer analysts covering the little guys, and these stocks are less efficiently priced. Hedge funds spend enormous resources to analyze and uncover data about these stocks because this is one of the places where they can generate significant outperformance. Our analysis also shows that this is also a fertile ground for piggyback investors.

Between June 1999 and August 2012, the 15 most popular small-cap stocks among hedge funds managed to return 127 basis points per month.

It is not a typo. Reread it.

This outperformance wasn’t due to high risk either. Our small-cap strategy’s monthly alpha was 81 basis points during this 13-year period (read the details here). This isn’t even the end of the story.

We launched a newsletter at the end of August 2012 that lists the stock picks of this small-cap strategy. During the 2.5 years between September 2012 and February 2015 hedge funds’ most popular small-cap stock picks returned 131.4% vs. 57.2% return for the S&P 500 ETF. This corresponds to an average monthly return of 2.95% for these stocks versus 1.55% for SPY.

Our proposition is very simple: dump your hedge funds and imitate their small-cap stock picks. You don’t have to surrender 2% of your assets and 20% of your returns. You don’t have to invest in hedge funds’ large-cap picks which usually underperform the market. Finally, you don’t have to worry about fraud/mismanagement and you will have instant access to your funds.

by Meena Krishnamsetty

Source: http://www.insidermonkey.com/hedge-fund/education-center/how-to-beat-the-market-by-20-percentage-points/1