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Since my article April 22, titled "2 Financials And 1 Retailer With Recent Intensive Insider Buying," the stocks that I featured have performed as follows:

Company

Price 4/19

Price 5/10

Change

First Security Group (NASDAQ:FSGI)

$2.72

$5.83

+114.3%

STAG Industrial (NYSE:STAG) $22.44 $23.06 +2.8%
U.S. Auto Parts Network (NASDAQ:PRTS) $1.18 $1.21 +2.5%

In this article, I will feature three additional stocks that have seen intensive insider buying during the last 30 days. Intensive insider buying can be defined by the following three criteria:

  1. The stock is purchased by three or more insiders within one month.
  2. The stock is sold by no insiders in the month of intensive purchasing.
  3. At least two purchasers increase their holdings by more than 10%.

1. Mueller Water Products (NYSE:MWA) engages in the manufacture and marketing of products and services used in the transmission, distribution, and measurement of water primarily in the United States and Canada.


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Insider buying by insider (last 30 days)

  • Joseph Leonard purchased 29,000 shares on May 6 and currently holds 69,298 shares or less than 0.1% of the company. Joseph Leonard has been a director since 2006.
  • Jerry Kolb purchased 7,400 shares on May 3 and currently controls 57,850 shares or less than 0.1% of the company. Jerry Kolb has been a director since 2006.
  • Bernard Rethore purchased 10,000 shares on May 3 and currently controls 66,602 shares or less than 0.1% of the company. Bernard Rethore has been a director since 2006.

Insider buying by calendar month

Here is a table of Mueller's insider trading activity by calendar month.

Month Insider buying / shares Insider selling / shares
May 2013 46,400 0
April 2013 0 0
March 2013 0 9,000
February 2013 0 0
January 2013 0 0

The month of May has seen all of the insider buying this year.

Financials

The company reported the fiscal 2013 second-quarter, which ended March 31, financial results on April 30 with the following highlights:

Revenue $283.1 million
Net income $6.2 million
Cash $37.9 million
Debt $600.9 million

Outlook

Mueller expects net sales to increase year-over-year. However, the company believes the growth rate will be less in the third quarter than in the second. The company expects adjusted operating income to improve across all of its key product categories and for the adjusted operating margin to improve slightly over the prior year.

Competition

Mueller's competitors include Tyco International (NYSE:TYC). Here is a table comparing these two companies.

Company MWA TYC
Market Cap: 1.15B 15.76B
Employees: 3,900 70,000
Qtrly Rev Growth (yoy): 0.13 0.03
Revenue: 1.09B 10.59B
Gross Margin: 0.27 0.36
EBITDA: 141.60M 1.21B
Operating Margin: 0.08 0.07
Net Income: 12.80M -331.00M
EPS: 0.17 0.12
P/E: 43.73 278.36
PEG (5 yr expected): 3.87 1.08
P/S: 1.06 1.49

Mueller is trading at a lower P/S ratio than its direct competitor.

My analysis

There have been three different insiders buying the shares and there have not been any insiders selling the shares during the last 30 days. There are four analyst buy ratings, four neutral ratings and one sell rating, with an average target price of $7.33. The stock is trading at a P/E ratio of 43.73 and a forward P/E ratio of 24.20. The company has a book value of $1.56 per share and the stock has a dividend yield of 0.96%. I have a neutral bias for the stock currently based on the analyst target prices.

2. Hutchinson Technology (NASDAQ:HTCH) engages in the research, design, development, manufacture, and supply of suspension assemblies for hard disk drives.


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Insider buying by insider (last 30 days)

  • Martha Aronson purchased 15,000 shares on May 8 and currently controls 50,000 shares or 0.2% of the company. Martha Aronson became a director of the company in 2010.
  • Frank Russomanno purchased 1,500 shares on May 9 and currently holds 40,084 shares or 0.2% of the company. Frank Russomanno became a director of the company in 2011.
  • Russell Huffer purchased 5,000 shares on May 6 and currently holds 45,693 shares or 0.2% of the company. Russell Huffer became a director of the company in 1999.
  • Thomas Verhage purchased 36,075 shares on May 2 and currently holds 185,399 shares or 0.7% of the company. Thomas Verhage became a director of the company in 2006.

Insider buying by calendar month

Here is a table of Hutchinson's insider trading activity by calendar month.

Month Insider buying / shares Insider selling / shares
May 2013 57,575 0
April 2013 0 0
March 2013 0 0
February 2013 2,000 0
January 2013 0 0

The month of May has seen the most insider buying this year.

Financials

The company reported the fiscal 2013 second-quarter, which ended March 31, financial results on April 30 with the following highlights:

Revenue $60.9 million
Net income $1.9 million
Cash $41.1 million
Debt $127.1 million

Outlook

The company expects its fiscal 2013 third quarter suspension assembly shipments to be roughly flat on a sequential basis at 95 million to 105 million, anticipating flat demand for disk drives. Third quarter average selling price is expected to increase slightly as a result of a higher percentage of DSA suspension assemblies in the mix of products shipped in the quarter. Third quarter gross profit is expected to decline due to lower fixed cost leverage on lower production volume following the inventory build in the second quarter.

Competition

Hutchinson's principal competitors for suspension assemblies are Nihon Hatsujo Kabusikigaisha [NHK], Magnecomp Precision Technology Public Company Limited, a subsidiary of TDK Corporation (OTCPK:TTDKY), and NAT Peripheral (H.K.) Co., (a joint venture of NHK and TDK Corporation). Hutchinson believes that consolidation in the disk drive industry has resulted in shifts in certain industry supply chain alignments that have negatively impacted its competitive position since 2008. Hutchinson's principal competitors in producing suspension flexures are Nitto Denko Corporation (OTCPK:NDEKF) and Dai Nippon Corporation.

My analysis

There have been four different insiders buying the shares and there have not been any insiders selling the shares during the last 30 days. There are two analyst buy ratings, one neutral rating and zero sell ratings, with an average target price of $3.80. The company has a book value of $6.26 per share. I believe the stock could be a good pick below the book value.

3. Mattson Technology (NASDAQ:MTSN) engages in the design, manufacture, marketing, and support of semiconductor wafer processing equipment used in the fabrication of integrated circuits for the semiconductor industry worldwide.


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Insider buying by insider (last 30 days)

  • Richard Dyck purchased 10,000 shares on May 6 and currently holds 85,400 shares or 0.1% of the company. Richard Dyck serves as a director of the company.
  • Kenneth Kannappan purchased 100,000 shares on April 29-30 and currently holds 109,800 shares or 0.2% of the company. Kenneth Kannappan is Chairman of the Board.
  • Fusen Chen purchased 50,000 shares on April 29 and currently holds 50,000 shares or 0.1% of the company. Fusen Chen is President and Chief Executive Officer of the company.

Insider buying by calendar month

Here is a table of Mattson's insider trading activity by calendar month.

Month Insider buying / shares Insider selling / shares
May 2013 10,000 0
April 2013 150,000 0
March 2013 0 0
February 2013 0 0
January 2013 0 0

There have been 160,000 shares purchased and zero shares sold this year.

Financials

The company reported the first-quarter financial results on April 24 with the following highlights:

Revenue $20.2 million
Net loss $9.5 million
Cash $10.8 million

Outlook

The company expects second quarter's net sale to increase from first quarter of 2013 by approximately 20%, representing a range of $24 million plus, minus $2 million. Mattson expects margins to be in the range of 30%, plus or minus 2%. With that, earnings will be in a range of a loss per share of $0.07, plus or minus $0.02. And the cash will be $16 million, plus or minus $2 million.

Competition

Mattson's competitors include Applied Materials (NASDAQ:AMAT) and Lam Research Corporation (LCRX). Here is a table comparing these companies.

Company MTSN AMAT LRCX Industry Average (Semiconductor Equipment & Materials)
Market Cap: 97.49M 17.87B 7.61B 1.10B
Employees: 323 14,526 6,600 918.00
Qtrly Rev Growth (yoy): -0.60 -0.28 0.28 0.20
Revenue: 96.26M 8.10B 3.35B 226.05M
Gross Margin: 0.34 0.39 0.38 0.17
EBITDA: -17.38M 1.34B 390.90M -10.28M
Operating Margin: -0.22 0.11 0.04 -0.74
Net Income: -27.71M 26.00M 46.24M N/A
EPS: -0.47 0.02 0.28 0.00
P/E: N/A 709.05 168.57 19.60
PEG (5 yr expected): -0.44 2.66 1.96 0.76
P/S: 1.00 2.21 2.28 1.25

Mattson is trading below the industry average P/S ratio.

My analysis

There have been three different insiders buying the shares and there have not been any insiders selling the shares during the last 30 days. There are zero analyst buy ratings, three neutral ratings and zero sell ratings, with an average target price of $1.45. The stock is trading at a forward P/E ratio of 27.33 and the company has a book value of $0.57 per share. I have a neutral bias for the stock currently based on the analyst estimates.

Disclosure: I have no positions in any stocks mentioned, but may initiate a long position in HTCH over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Source: 2 Tech Stocks And 1 Industrial Goods Company With Recent Intensive Insider Buying