ARC Group Worldwide: 3 Different Insiders Have Purchased Shares Since November 19

Dec. 5.13 | About: ARC Group (ARCW)

Editors' Note: This article covers one or more micro-cap stocks. Please be aware of the risks associated with these stocks.

In this article, I will feature one tech stock that has 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 increased their holdings by more than 10%.

ARC Group Worldwide (NASDAQ:ARCW) manufactures and sells precision components, flanges, fittings, and wireless equipment in North America and Europe.

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Insider buying during the last 30 days

Here is a table of ARC Group Worldwide's insider-trading activity during the last 30 days by insider.

Name Title Trade Date Shares Purchased Current Ownership Increase In Shares
Eddie Neely Director Dec 2 500 500 shares from 0 to 500
Theodore Deinard CEO ARC Wireless Nov 21-27 6,600 7,569 shares +681.1%
Jason Young CEO of ARC Nov 19-22 8,047 3,775,683 shares +0.2%
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There have been 15,147 shares purchased by insiders during the last 30 days.

Insider buying by calendar month

Here is a table of ARC Group Worldwide's insider-trading activity by calendar month.

Month Insider buying / shares Insider selling / shares
December 2013 500 0
November 2013 14,647 0
October 2013 0 0
September 2013 0 0
August 2013 0 0
July 2013 0 0
June 2013 0 0
May 2013 0 0
April 2013 0 0
March 2013 0 0
February 2013 0 0
January 2013 0 0
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There have been 15,147 shares purchased and there have been zero shares sold by insiders this year. The month of November has seen the most insider buying.

Financials

ARC Group Worldwide reported the third-quarter financial results on November 13 with the following highlights:

Revenue $18.4 million
Net income $1.3 million
Cash $4.3 million
Debt $30.4 million
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Competition

ARC Group Worldwide's competitors include SIFCO Industries (NYSEMKT:SIF), and Barnes Group (NYSE:B). Here is a table comparing these companies.

Company ARCW SIF B
Market Cap: 109.25M 140.26M 1.91B
Employees: 442 565 5,110
Qtrly Rev Growth (yoy): 0.38 0.11 0.16
Revenue: 73.56M 131.54M 1.36B
Gross Margin: 0.28 0.23 0.36
EBITDA: 10.85M 16.36M 227.82M
Operating Margin: 0.10 0.08 0.12
Net Income: 4.59M 7.11M 91.20M
EPS: 0.78 1.58 4.97
P/E: 23.93 16.42 7.29
PEG (5 yr expected): N/A N/A 2.01
P/S: 1.68 1.09 1.41
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ARC Group Worldwide is currently growing fastest among these three companies.

Here is a table of these competitors' insider-trading activities this year.

Company Insider buying / shares Insider selling / shares
SIF 153,940 5,000
B 0 98,527
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Only ARC Group Worldwide has seen intensive insider buying during the last 30 days.

Conclusion

There have been three different insiders buying ARC Group Worldwide and there have not been any insiders selling ARC Group Worldwide during the last 30 days. Two of these three insiders increased their holdings by more than 10%. ARC Group Worldwide has an insider ownership of 2.90%.

ARC Group Worldwide is trading at a P/E ratio of 23.93 and the company has a book value of $4.70 per share. The insiders purchased their shares at a price range of $16-$20. The stock closed at $18.59 on December 4. I believe the stock could be a good speculative pick around $16 based on the intensive insider buying.

Disclosure: I have no positions in any stocks mentioned, but may initiate a long position in ARCW 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.