Many insiders are finding value in stocks and have made significant new buys in 2012. These buys are being made in a wide variety of industries from teen retailers to electrical equipment makers to Internet-based companies.
Insider buying can provide great insight into where a stock might be heading. Insiders usually know their companies better than the average investor or stock analyst, so when they use their own money to buy shares, it can be very meaningful. Some of these stocks are near the lows for the past year, and look like great buying opportunities. Others look like potential trades. I have provided links for each stock which verifies the insider buying filed with the SEC below. Here are some stocks with strong insider buying in 2012:
WebMD Health Corp. (WBMD) shares are trading at $26.30. This company provides health and medical information to consumers and physicians through its magazine, the Internet and other channels. The 50-day moving average is $34.07 and the 200-day moving average is $39.26. The 52-week range is $25.01 to $58.55. Earnings estimates for WebMD are at $1.22 per share in 2011 and 46 cents for 2012. This stock plunged recently after the company announced the CEO was resigning, and that it was no longer exploring the sale of the company. The earnings outlook is not great, and the stock is acting very weak, so I would wait for signs of a bottom before considering an investment here. On January 18, 2012, an insider (Icahn Partners) reported buying over 340,000 shares.
Actuant Corporation (ATU) is trading at about $24.80. Actuant is a manufacturer of electrical, industrial, and hydraulic equipment. These shares have a 52 week range of $8.45 and $18.47. The 50-day moving average is $22.48 and the 200-day moving average is $23.13, so the shares are trading above these key support levels. Book value is stated at $13.43 per share. Earnings estimates indicate a profit of $1.96 per share for 2011, and $2.15 for 2012. Actuant pays a dividend of 4 cents per share, which is equivalent to a 0.2% yield. In recent weeks, Actuant shares were trading around $21 to $23, but the stock has been rising with the market. It's likely that this stock will drop back to at least $23 when the market corrects, so waiting for dips makes sense. On January 12, 2012, an insider reported buying 2,136 shares.
Hot Topic, Inc., (HOTT) is trading around $7.84. Hot Topic is a specialty retailer of clothing and accessories, and is based in California. This company focuses its products and marketing towards a younger crowd. These shares have traded in a range between $5.05 to $8.74 in the last 52 weeks. The 50-day moving average is $6.92 and the 200-day moving average is $7.22. Earnings estimates are at 17 cents for 2011, and 26 cents for 2012. The book value is stated at $4.22. This company has a strong balance sheet, which is not always common for a retailer. This company pays a dividend of 28 cents per share, which is equivalent to a 3.9% dividend yield. This stock has dipped to about $6.50 twice in the past three months, and it could be an interesting trade on dips to that level. With earnings estimates looking weak, the dividend could need to be cut, and that would concern me with this stock. Insiders seem to find value in this stock and have been buying repeatedly. On January 12, 2012, and insider reported buying over 60,000 shares.
Texas Industries, Inc. (TXI) is trading around $31.84. This company manufactures and markets a wide variety of construction materials. These shares have traded in a range between $21.89 to $46.45 in the last 52 weeks. The 50-day moving average is $28.42 and the 200-day moving average is $34.95. TXI is estimated to lose about $1.98 per share in 2012, and about $1 for fiscal year 2013. This company pays a dividend of 30 cents per share, which is equivalent to a 1% dividend yield. The book value is $23.96 and the stock has been in an uptrend since early December. Buying on dips could make sense, but this company is in economically sensitive industry, so until the job and housing market really turns around, this stock will probably be stuck in a trading range. On January 12, 2012, an insider reported buying 10,000 shares.
The data is sourced from Yahoo Finance and Insidercow.com.
Disclaimer: 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.