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In this article, I will feature one services sector 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%.

Regis Corporation (NYSE:RGS) owns, operates, and franchises hairstyling and hair care salons for men, women, and children in the United States, Canada, Puerto Rico, and the United Kingdom.

(click to enlarge)

Insider buying during the last 30 days

Here is a table of Regis' insider-trading activity during the last 30 days by insider.

NameTitleTrade DateShares PurchasedCurrent OwnershipIncrease In Shares
David WilliamsDirectorJan 305,00023,433 shares+27.1%
Daniel BeltzmanDirectorJan 29-311,502,5079,996,589 shares+17.7%
Stephen WatsonDirectorJan 302,00047,566 shares+4.4%
Daniel HanrahanCEOJan 2920,000221,839 shares+9.9%

There have been 1,529,507 shares purchased by insiders during the last 30 days.

Insider buying by calendar month

Here is a table of Regis' insider-trading activity by calendar month.

MonthInsider buying / sharesInsider selling / shares
January 20141,529,5070
December 201300
November 201300
October 201300
September 201300
August 201300
July 201300
June 201300
May 201300
April 201300
March 201300
February 201300
January 201300

There have been 1,529,507 shares purchased, and there have been zero shares sold by insiders since January 2013. The month of January 2014 has seen all of the insider buying.

Financials

Regis reported the fiscal 2014 second-quarter, which ended December 31, financial results on January 27 with the following highlights:

Revenue$468.4 million
GAAP net loss$110.0 million
Cash$339.4 million
Debt$294.2 million

The stock plunged after these results, and the insiders started buying only after these results.

Competition

Regis' competitors include Ulta Salon, Cosmetics & Fragrance (NASDAQ:ULTA). Here is a table comparing these two companies.

CompanyRGSULTA
Market Cap:711.39M5.36B
Employees:50,0005,600
Qtrly Rev Growth (yoy):-0.080.22
Revenue:1.94B2.56B
Gross Margin:0.340.35
EBITDA:90.47M418.19M
Operating Margin:0.010.12
Net Income:-124.47M196.70M
EPS:-1.903.05
P/E:N/A27.26
PEG (5 yr expected):N/A1.25
P/S:0.362.15

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

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

MonthInsider buying / sharesInsider selling / shares
January 201400
December 201300
November 201300
October 201300
September 2013044,188
August 201300
July 201300
June 201309,659
May 201300
April 201300
March 201310,00070,000
February 201300
January 201300

In Ulta, there have been 10,000 shares purchased, and there have been 123,847 shares sold by insiders since January 2013. Only Regis has seen intensive insider buying during the last 30 days.

Conclusion

There have been four different insiders buying Regis, and there have not been any insiders selling Regis during the last 30 days. Two of these four insiders increased their holdings by more than 10%. Regis has a book value of $13.16 per share.

Regis has an $11 price target from the Point and Figure chart. I would be looking to be a buyer around $11 based on the intensive insider buying.

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Source: Regis: 4 Different Insiders Have Purchased Shares This Year