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The stocks below are trading at significant discounts to their 52-week highs. Some have been hit very hard recently for various reasons, while others are down significantly from their 52-week highs. Big drops and bad news in some of these stocks has scared away many investors, but that hasn't stopped insiders at these companies from buying shares. Insiders tend to know the future prospects of a company better than anyone, so I think it makes sense to pay attention to insider buying, especially when stocks might be selling at bargain levels. I have provided links for each stock which verifies the insider buying filed with the SEC below. Here are the stocks:
Conn's Inc.'s (NASDAQ:CONN) shares are trading at $5.42. CONN is a leading electronics retailing company. These shares have been beaten down for awhile now, as the company has struggled with different issues. The 52-week high is $10.33, so these shares are down by almost 50% off the highs. The 50-day moving average is about $4.51 and the 200-day moving average is about $4.70. Earnings estimates for CONN are for a profit of 38 cents per share for the current fiscal year. I don't see a reason to be invested here, because competition from online retailers and Best Buy (NYSE:BBY) is intense, but some insiders seem to think these shares make sense. You can see the recent insider buying here.
American Superconductor (NASDAQ:AMSC) is trading at about $14 in the after hours session. These shares have a 52-week range of $21.70 and $38.88. The 50-day moving average is $26.13 and the 200-day moving average is $29.67, so the shares are trading well below these key support levels. Earnings estimates for AMSC are about $1.33 per share in 2011 and $1.26 for 2012 Book value is stated at $9.86 per share. These shares have been drifting lower since February, and dropped even more when AMSC announced it would be acquiring a Finnish company called The Switch Engineering for about $265 million. AMSC just warned that a big customer declined delivery on some orders and that the financials will be negatively impacted. You can read more about these issues here. It seems that the insider who was buying recently did not get the memo before loading up on so many shares. You can see the recent insider buying here. I would not buy these shares yet, as it may take awhile for this situation to stabilize.
THQ Inc., (THQI) shares are trading at $4.58. THQI is a leading video game company. It reported earnings that disappointed the market, and shares dropped to current levels. The 52-week high is $8.29. The 50-day moving average is about $5.36 and the 200-day moving average is about $4.80. Earnings estimates for THQI are for a loss of 29 cents per share in 2011 and profit of about 30 cents for 2012.
THQI stock has a book value of $3.67 per share. THQI recently announced that its Homefront video game has sold more than one million units so far. You can see the recent insider buying here.
Zale Corporation (NYSE:ZLC) shares are trading at $4.25. ZLC is a leading jewelry retailer. These shares have been beaten down for awhile now, as the company has struggled with weak sales and other issues. The 52-week high is $5.88. The 50-day moving average is about $4.25 and the 200-day moving average is about $3.01. Earnings estimates for ZLC are for a loss of $2.21 per share for 2011 and another loss of $1.70 for 2012. I don't see a reason to be invested here, but some insiders seem to think these shares make sense. Jewelry sales have been improving as the economy picks up. You can read about improving trends in this sector here. You can see the recent insider buying here.
Exar Corporation (NYSE:EXAR) shares are trading at $6.23. EXAR is a semiconductor company, based in California. The 52-week high is $7.74 (before 2008, these shares regularly traded for over $12). The 50-day moving average is about $6.26 and the 200-day moving average is about $6.51. Earnings estimates for EXAR are for a loss of 18 cents per share for 2011 and a profit of 8 cents per share for 2012. According to Yahoo Finance, EXAR has about $202 million in cash (which is equivalent to $4.54 per share in cash) and only about $15 million in debt. Soros Fund Management, LLC., has been buying shares of EXAR repeatedly. You can see the recent insider buying here.
Pacific Sunwear of California, Inc. (NASDAQ:PSUN) is trading around $3.64. Pacific Sunwear is a specialty retailer based in California. These shares have seen a 52-week high of $6.84 and a low of $2.92 . The 50-day moving average is $4.12 and the 200-day moving average is $4.69. PSUN recently cut guidance, which has put pressure on the stock. Based on earnings estimates, this company is expected to post a loss for 2011, but that hasn't stopped a couple of insiders from making substantial and repeated buys. You can see the insider buys here.
Auxilium Pharmaceuticals (NASDAQ:AUXL) shares are trading at $21.47. AUXL is a specialty biopharmaceutical company, based in Pennsylvania. The 52-week high is $38.50, so these shares are almost 50% lower now. The 50-day moving average is about $22.53 and the 200-day moving average is $23.23. Earnings estimates for AUXL are for a loss of 77 cents per share for 2011 and a profit of 18 cents for 2012. According to Yahoo Finance, AUXL has about $128 million in cash (which is equivalent to $2.68 per share in cash) and basically no debt. Baker Brothers Life Sciences Capital, LLC., has been buying shares of AUXL repeatedly. You can see the recent insider buying here.
The data is sourced from Yahoo Finance and Stockcharts.com. The information and data is believed to be accurate, but no guarantees or representations are made.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
Source: 7 Beaten-Down Stocks With Insider Buying