A major market correction has created much lower stock prices, and many insiders are taking advantage of this opportunity. The amount of insider buying has surged in the last few weeks. When you see insider buying at depressed prices, it often means the shares are oversold and offer great long term value. Some of these stocks look like good investments for the future, while others seem to be better as a short term trading opportunity. I have provided links for each stock which verifies the insider buying filed with the SEC below. Here are the stocks:
Opko Health Inc., (OPK) is trading around $5.66. Opko is a specialty drug and vaccine company, based in Florida. These shares have traded in a range between $2.80 to $5.85 in the last 52 weeks. The 50-day moving average is $4.84 and the 200-day moving average is $4.14. OPK is estimated to post a loss in 2011, as it works to develop its product line. This stock is getting noticed lately as Jim Cramer recently called it a buy and an analyst at Jefferies recently did the same, giving OPK shares a $8 price target. This stock looks like a good buy on any dips. The CEO has an excellent track record in this industry and he has been making regular purchases of stock worth many thousands of dollars. You can see the repeated insider buying here.
Kellogg Company (K) shares are trading at $49.80. Kellogg is a leading maker of cereals, cookies, crackers and other foods. These shares have traded in a range between $48.53 to $57.70 in the last 52 weeks. The 50-day moving average is $53.08 and the 200-day moving average is $53.93. Earnings estimates indicate a profit of $3.34 per share for 2011, and $5.55 for 2012. The dividend is $1.72 per share, which yields 3.2%. Just recently, the stock dropped from about $55 down to around $49, after Kellogg released earnings that disappointed most investors. Profits were down about 14% in the 3rd quarter partially due to rising commodity costs. It's probably a little early to buy, but on a further dip to about $45 per share or less, this starts to look cheap. A director recently bought 10,000 shares.
Gannett Incorporated (GCI) is trading around $11.38. Gannett owns several major newspapers and is based in Virginia. The 50-day moving average is $10.54 and the 200-day moving average is $13.17. These shares have traded in a range between $8.28 to $18.93 in the last 52 weeks. Earnings estimates for GCI are about $2.12 per share in 2011 and $2.16 for 2012. GCI pays a dividend of 32 cents per share which is equivalent to a yield of 2.8%. This stock was trading around $14 in July and has since plunged to current levels. This stock could remain weak for a while, so it only makes sense to average in and buy on dips below $10. A director just bought 1,000 shares.
Inland Real Estate (IRC), is trading around $7.23. Inland is based in Illinois and invests primarily in shopping centers and retail properties. These shares have traded in a range between $6.57 to $9.99 in the last 52 weeks. The 50-day moving average is $8.40 and the 200-day moving average is $8.67. The book value is stated at $3.98. IRC pays a solid dividend of 57 cents per share, which is equivalent to a 7.8% yield. This stock looks like a good buy on dips, but if the economy slips back into a recession due to European debt problems or other issues, there will be more downside. The CEO recently reported buying 1,085 shares, and others have been buying as well. You can see the insider buying here.
Schlumberger (SLB) is trading at $75.97 today. SLB is a leading oil equipment and service company. These shares have traded in a range between $54.97 to $95.64 in the past 52 weeks. The 50-day moving average is $69.26 and the 200-day moving average is $81.53. Earnings estimates for SLB are just $3.67 per share in 2011, and $4.94 for 2012. The book value is about $23.47. SLB pays a small dividend of $1 per share which gives a yield of 1.3%. Now that SLB shares are well off the 52 week high, it makes sense to be slowly accumulating. Oil prices have been rising in recent weeks, and that is likely to help most oil related stocks have a very good quarter. An officer just bought 6,000 shares and other insiders have been buying as well. See the insider buying here.
Smart Balance (SMBL) shares are trading at $5.58. Smart Balance is a maker of specialty food products that are popular with health conscious consumers. The 50-day moving average is $5.90 and the 200-day moving average is $5.07. Earnings estimates for SMBL are just 24 cents per share in 2011, and 30 cents for 2012. Smart Balance looks undervalued if you consider the book value is $5.23. Smart Balance has had buyout rumours in the past because a larger food company could squeeze expenses out of this as well as expand the brand and develop more products. This stock was trading around $7 and then dropped after disappointing earnings were reported. Now it looks like insiders are taking advantage of the lower price and 3 insiders recently purchased over 20,000 shares, see that here.
The data is sourced from Yahoo Finance and Insidercow.com. The information and data is believed to be accurate, but no guarantees or representations are made. Rougemont is not a registered investment advisor and does not provide specific investment advice. The information contained herein is for informational purposes only.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.