This week’s list of CEO purchases focuses on those CEOs who have purchased at least $100,000 of stock in their own company on the open market in the past week or so. These are significant purchases and may indicate a coming catalyst and confidence in the company.
As I’ve mentioned before, I think companies with recent insider purchases are great places to find stocks worth researching and I prefer CEO purchases over director purchases because you know that CEOs are closer to every day issues.
Below are nine stocks where the CEO has recently purchased at least $100,000 of company stock:
Lorillard (LO): Lorillard is an interesting stock. It had been driven down because of the regulatory threat of a menthol ban, which is a cause for concern since they’re the leading menthol cigarette maker. If you’re interested in learning more about the specific threat and what it means for Lorillard, I recently wrote the following article and I encourage you to read it: Lorillard Reports Smokin' Earnings, But Uncertainty Looms.
CEO Murray Kessler seems to be confident in the stock, and will be picking up a 6.5% yield from their newly raised dividend. Kessler bought 12,500 shares on February 18 totaling nearly $900,000.
American Water Works Company (AWK): American Water Works is another big dividend yielder at 3.2%. They provide water and wastewater services in the United States and Canada and have a $4.8 billion market cap. CEO Jeffry Sterba bought $109,000 worth of stock on the open market on February 17.
Cherokee (CHKE): Staying on the dividend theme, Cherokee is going the other direction. They cut their dividend last month, but still yield 4.7% after the cut. CEO Henry Stupp bought $181,500 of company stock on February 17 at $18.15 per share. The stock is now in the low $17 range. Cherokee manages brands and licenses products, primarily clothes, to a variety of retailers.
NetSol Technologies (NTWK): NetSol is a small $100 million market cap software company. CEO Najeeb Ghauri owns about 3.5% of the company. On February 16, Najeeb bought another $200,000 of company stock on the open market. Ghauri and his family have been picking up company shares for years and have never sold a share.
Datawatch (DWCH): CEO Michael Morrison owns more than 4% of the company and purchased 30,000 more shares on February 15 and 16. He owns about 350,000 shares directly and indirectly. Morrison just became CEO on February 14, replacing Ken Bero. Datawatch is a Massachusetts-based software company serving 44,000 organizations worldwide. Its market cap is only $30 million.
PennyMac Mortgage Investment Trust (PMT): CEO Stanford Kurland participated in a secondary offering for the company and purchased 50,000 shares at $18 on February 16. PennyMac is using the proceeds to purchase two residential mortgage loan portfolios. PennyMac is a REIT that paid out $1.19/share in dividends in 2010. Management appears to be bullish on this transaction as evidenced by Kurland’s $900,000 investment in the offering and the COO’s $180,000 purchase.
Two Harbors Investment (TWO): Two Harbors is another REIT focused on residential mortgage loans. CEO Thomas Siering bought 30,000 shares on February 16, totaling $318,000. He was joined by five other insiders making purchases within a few days of his purchase. Siering owns 155,000 shares. The REIT paid out dividends of $1.60/share in 2010. If they keep the pace this year, the stock would yield nearly 15%.
Coca-Cola Enterprises (CCE): CEO John Brock bought nearly $180,000 worth of shares on February 15. He currently owns about 180,000 shares. Coca-Cola Enterprises is the third largest Coke (KO) bottler in the world. In 2010, Coca-Cola purchased their North American operations.
Chimera Investment Corp. (CIM): Chimera is the third REIT on this list. They paid out $0.69/share in dividends, which would yield in the 15% range today. CEO Matthew Lambiase bought 50,000 shares on February 15 totaling $209,000. He’s been making purchases like this for years and he currently owns 415,000 shares.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.