Investors follow the buying trends of company insiders because, after all, they know more about their companies than anyone else. If a stock sees increased buying from insiders, it’s a signal to take a second look.
We ran a screen on the 200 largest stocks by market cap for those seeing significant net insider buying over the last six months.
Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the 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.
Do you agree with insiders on these names? Use this list as a starting-off point for your own analysis.
List sorted by net insider purchases as a percent of share float.
1. VMware, Inc. (NYSE:VMW): Provides virtualization and virtualization-based cloud infrastructure solutions primarily in the United States. Market cap at $38.93B. Over the last six months, insiders were net buyers of 1,621,764 shares, which represents about 2.06% of the company's 78.78M share float. Five year projected EPS growth at 24.64%, which may be appealing to growth investors.
2. Dell Inc. (NASDAQ:DELL): Provides integrated technology solutions in the information technology industry worldwide. Market cap at $26.82B. Over the last six months, insiders were net buyers of 17,230,709 shares, which represents about 1.11% of the company's 1.55B share float.
3. Tyco Electronics, Ltd. (NYSE:TEL): Provides engineered electronic components, network solutions, specialty products, and subsea telecommunication systems. Market cap at $13.26B. Over the last six months, insiders were net buyers of 119,500 shares, which represents about 0.03% of the company's 432.40M share float. Short sellers have been avoiding the stock (short float is at a below-average 0.34%). This may suggest that sophisticated investors, like short sellers, don't see any obvious weaknesses in the company.
*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.