This week I have four stocks that have recent significant CFO buys. Two of the stocks also saw large CEO buys. The other two stocks are interesting value-oriented plays. When looking at insider buys, I prefer to follow CEO and CFO purchases since those two positions should have the best handle on the company. When there are buys from each position, the stock deserves a closer look than usual. Sometimes it’s because of a public offering, other times it may be coordinated in order to get attention from the markets or simply because each of the insiders thinks the stock is materially undervalued.
Below are four stocks with recent CFO buys of at least $40,000:
Hasbro (HAS): CFO Deborah Thomas bought 5,000 company shares on July 20 at an average price of $39.50. The total transaction was for $197,500. CEO Brian Goldner bought the same amount of shares on the same date. Hasbro recently announced better than expected earnings but some analysts have concerns going forward about whether they can keep the top line up considering most of the revenue gains were because of Transformers sales. Street Authority has an interesting piece on the stock here on Seeking Alpha taking the other side and arguing that it’s a solid long term buy because of multiple expansion and earnings growth. He gives it a price target around $50.
Tuesday Morning (TUES): CFO Stephanie Bowman bought 10,000 company shares on July 19 at $4.03 making the total transaction $40,300. Bowman’s purchases were joined by COO Michael Marchetti, who also bought 10,000 shares on July 19. Tuesday Morning shares have bounced around quite a bit in the past year. In the most recent quarter, the company earned 3 cents per share. They also announced a yearly EPS forecast of $0.21 to $0.23 per share for 2011. At today’s price, that gives them a P/E of around 20. The company also has about $7 in assets, significantly more than the current share price. Tuesday Morning is a close-out retailer focusing on homewares. Because of the nature of the business, it should have a better ability to turn its inventory into sales than other retailers. Noted small cap investor Chuck Royce, president of the Royce Funds, owns a bit less than 5% of the company.
Oiltanking Partners (OILT): Oiltanking Partners completed their IPO on July 19. Shares had begun trading on July 14. CFO Kenneth Owen participated in the offering along with CEO Carlin Conner and six other insiders. Owen bought 7,500 shares at the $21.50 offering price. The total purchase was $161,250. Though it hasn’t shown up yet on Seeking Alpha’s stock overview, the partnership will pay out an annual dividend of $1.35. At today’s price, that gives it a yield of 5.6%. Oiltanking Partners “provides integrated terminaling, storage, pipeline, and related services for third-party companies engaged in the production, distribution, and marketing of crude oil, refined petroleum products, and liquefied petroleum gas.”
Audiovox (VOXX): CFO Frederick Farrar bought 10,000 shares on July 15 at an average price of $7.58. Audiovox is an electronics seller with brands like the namesake Audiovox, along with RCA, Jensen and others. The company is owned by some very savvy value investors. Seth Klarman has owned shares since 2007 and sold a portion of his holdings on June 9. Irving Kahn and Donald Smith also own the company. They own nearly 23% of the outstanding shares between the three of them. Klarman may be selling shares because of Audiovox’s Klipsch acquisition earlier this year. Saj Karsan has a piece from May complaining about the buy.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.