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Do you find value in studying insider activity as a trading indicator? If so, you’re not alone. Analysts closely monitor insider trading for clues on which direction the company is headed. If you’re among them, then this list may be an interesting starting point for your analysis.

To create this list we first searched for names with a price to cash flow ratio (P/C) under 5. When a company has a high cash balance relative to their market cap it may signal undervalued conditions.

Next we searched for the names that have been experiencing significant levels of insider buying over the past 6 months, as well as those with a market cap over $300M.

We were left with the 12 names detailed below.

Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the top six stocks mentioned below. Analyst ratings sourced from Zacks Investment Research.


We also created a price-weighted index of the stocks mentioned below, and monitored the performance of the list relative to the S&P 500 index over the last month. To access a complete analysis of this list's recent performance, click here.



Considering this information, do you think these stocks are truly undervalued? Which names do you feel most bullish about?

1. ZIOPHARM Oncology, Inc. (NASDAQ:ZIOP): Biotechnology Industry. Market cap of $406.66M. Price/cash ratio at 3.28. Net insider purchases over the last 6 months at 4336240 shares, equal to 8.21% of the company's 52.80M share float. The stock is a short squeeze candidate, with a short float at 10.21% (equivalent to 8.46 days of average volume). The stock has gained 2.85% over the last year.

2. AMAG Pharmaceuticals, Inc. (NASDAQ:AMAG): Diagnostic Substances Industry. Market cap of $361.41M. Price/cash ratio at 1.52. Net insider purchases over the last 6 months at 991150 shares, equal to 7.68% of the company's 12.91M share float. The stock is a short squeeze candidate, with a short float at 7.76% (equivalent to 8.65 days of average volume). The stock has had a couple of great days, gaining 8.58% over the last week.

3.
Motorola Solutions, Inc. (NYSE:MSI): Communication Equipment Industry. Market cap of $15.50B. Price/cash ratio at 2.49. Net insider purchases over the last 6 months at 17600969 shares, equal to 6.3% of the company's 279.45M share float. The stock has gained 2.65% over the last year.

4. Visteon Corp. (NYSE:VC): Auto Parts Industry. Market cap of $3.34B. Price/cash ratio at 4.01. Net insider purchases over the last 6 months at 1770350 shares, equal to 4.48% of the company's 39.52M share float. The stock has gained 5.29% over the last year.

5. GeoEye, Inc. (NASDAQ:GEOY): Information & Delivery Services Industry. Market cap of $799.01M. Price/cash ratio at 2.85. Net insider purchases over the last 6 months at 810000 shares, equal to 4.07% of the company's 19.90M share float. The stock has lost 10.08% over the last year.

6. American Superconductor Corporation (NASDAQ:AMSC): Diversified Electronics Industry. Market cap of $412.70M. Price/cash ratio at 1.7. Net insider purchases over the last 6 months at 1508478 shares, equal to 3.86% of the company's 39.06M share float. The stock has performed poorly over the last month, losing 19.88%.

7. Live Nation Entertainment, Inc. (NYSE:LYV): General Entertainment Industry. Market cap of $1.99B. Price/cash ratio at 2.02. Net insider purchases over the last 6 months at 4457940 shares, equal to 3.66% of the company's 121.71M share float. This is a risky stock that is significantly more volatile than the overall market (beta = 2.07). The stock is a short squeeze candidate, with a short float at 6.89% (equivalent to 5.96 days of average volume). The stock has gained 8.1% over the last year.

8. Ardea Biosciences, Inc. (NASDAQ:RDEA): Drug Manufacturers Industry. Market cap of $668.62M. Price/cash ratio at 4.26. Net insider purchases over the last 6 months at 495549 shares, equal to 2.32% of the company's 21.35M share float. The stock is a short squeeze candidate, with a short float at 6.46% (equivalent to 14.04 days of average volume). The stock has had a good month, gaining 11.47%.

9. PHI Inc. (NASDAQ:PHII): Air Services, Other Industry. Market cap of $319.21M. Price/cash ratio at 2.43. Net insider purchases over the last 6 months at 200000 shares, equal to 2.2% of the company's 9.11M share float. The stock has lost 9.35% over the last year.

10. Chesapeake Lodging Trust Common Shares of Beneficial Interest (NYSE:CHSP): REIT - Hotel/Motel Industry. Market cap of $549.29M. Price/cash ratio at 2.93. Net insider purchases over the last 6 months at 604000 shares, equal to 2.06% of the company's 29.31M share float. The stock has gained 0.18% over the last year.

11. Tower International, Inc. (NYSE:TOWR): Metal Fabrication Industry. Market cap of $332.91M. Price/cash ratio at 2.48. Net insider purchases over the last 6 months at 74000 shares, equal to 1.13% of the company's 6.56M share float. The stock has had a couple of great days, gaining 9.48% over the last week.

12. Dell Inc. (NASDAQ:DELL): Personal Computers Industry. Market cap of $30.68B. Price/cash ratio at 2.12. Net insider purchases over the last 6 months at 17230709 shares, equal to 1.07% of the company's 1.61B share float. The stock has gained 7.46% over the last year.

*Insider data sourced from Yahoo! Finance, all other data sourced from Finviz.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Source: 12 Undervalued Stocks With Significant Levels of Insider Buying