As the markets retreated over the last few weeks, insider buying among CEOs increased. Large insider buys were made by CEOs across a wide range of industries and market caps. You’ll recognize some of these stocks from previous editions, and I’ll point out significant purchases when appropriate. For other stocks, it has been the first purchase in some time. The high number of large buys indicates to me that these CEOs are confident in their own companies and, in most cases, feel that the stocks are significantly undervalued.
Without further ado, here are the ten CEO buys of at least $100,000 in the past week:
Morgan Stanley (MS): While I think Morgan Stanley is cheap here, trading at a price to tangible book of 0.8, I also think this purchase was a concerted effort to draw attention to the stock. For the first time in a year and a half an insider made a buy. In fact, there were five insider buys within a three day period. CEO James Gorman was the big one. He bought 100,000 shares on August 4 at an average price of $20.62. That made his total purchase was north of $2 million. The market is tough right now, for sure, but Morgan Stanley’s stock is down 27% from the start of the year.
HCC Holdings (HCC): CEO John Molbeck bought 10,000 shares on August 5 at an average price of $28.50. Molbeck had previously bought shares of this insurer back in June at a price almost 10% higher than now. HCC Holdings traded at a price to book of 1.1 back then. Today it’s at 0.9. HCC is a large holding of value investor John Rogers, who I wrote about last month.
Kronos Worldwide (KRO): Kronos produces titanium dioxide, which is a pigment that makes products whiter and brighter. CEO Steven Watson made two large recent purchases. He bought 10,000 shares on August 3 at an average price of $26.65, and then bought 8,000 more shares on August 5 at $21.83. His total purchases were about $440,000.
Dana Holding Corp. (DAN): Dana Holdings is another company where the CEO had just recently bought shares. CEO Roger Wood had spent about $200,000 on company shares back in June. He made a similar size purchase on August 3 by buying 12,940 shares at an average price of $15.45. This was about 10% cheaper than his previous purchase. This vehicle part manufacturer reported very good earnings just two weeks ago.
Tupperware Brand (TUP): CEO EV Goings bought 8,360 shares on August 3 at an average price of $60.65. The total transaction was worth about $507,000. Shares have slid more than 20% since the company announced solid earnings on July 27. Then, the stock was at a 52 week high and had run up considerably over the past year. Even with the recent weakness valuations don’t seem stretched and the stock is yielding more than 2%.
Kinder Morgan (KMI): I wrote about Kinder Morgan at the end of March after CEO Richard Kinder bought nearly $3 million worth of shares. More recently, on August 3, Kinder bought 50,000 shares at an average price of $27.67. Kinder also bought 25,000 shares of of Kinder Morgan Management (KMR) for about $1.5 million.
Dynex Capital (DX): Dynex Capital is a $359 million market cap mortgage REIT with a 12.1% dividend yield. The recent debt ceiling debate and credit downgrade has hit mortgage REITs particularly hard, though Dynex has held up better than others. CEO Thomas Akin bought 25,088 shares on August 2 at an average price of $9.13.
Glacier Bancorp (GBCI): CEO Michael Blodnick joined by five other insiders by buying company shares recently. Blodnick bought 10,000 shares on August 2 at $12.97. Glacier is a pretty impressive bank and was able to grow its book value through the crisis. Shares are currently at 52 week lows despite yielding 4.2%. Price to book is at 1.1, which is significantly lower than its historical average. Price to tangible book is 1.3.
Cadence Design Systems (CDNS): CEO Lip Bu Tan made two recent purchases, 10,000 shares on August 4 and 20,000 shares on August 2. The average price of the stock for these transactions was $9.78. I had highlighted Cadence Designs in February after CFO Geoffrey Ribar made a large buy. Shares of this electronic design automation company are cheaper now compared to then.
Acorn Energy (ACFN): Acorn Energy is a tiny $80 million market cap energy technology company. CEO John Moore bought 35,000 shares on August 1 at an average price of $4.95. At the end of July the company announced plans to sell one of its subsidiary, CoaLogix, for $101 million. Acorn owns 65% of CoaLogix. After expenses, the sale will net Acorn Energy $3.53 per share in cash. since the announcement, Acorn shares are up by about $1.