Do you wish you could get an inside peak at your favorite companies? One idea is to look at insider buying, or how many company shares insiders such as members of the board and upper management are buying.
We ran a screen with this idea in mind. We began by screening for stocks that appear undervalued to both earnings growth and free cash flow, with PEG below 1 and P/FCF below 15.
We then screened these names for those with optimism from their insiders, with significant net insider purchases over the last six months above 1% of share float. Because there is only a small number of insiders at most companies, insider purchases representing 1% of share float is a big sign of optimism.
Interactive Chart: Press Play to compare changes in market cap over the last two years for the stocks mentioned below. Analyst ratings sourced from Zacks Investment Research.
Do you think these insiders are right to expect their employers to outperform? Use this list as a starting point for your own analysis.
List sorted by net insider purchases over the last six months as a percent of share float.
1. Vistaprint N.V. (VPRT): Operates as an online provider of marketing products and services to micro businesses worldwide. Market cap at $1.37B. Price at $37.85. PEG at 0.91. P/FCF at 9.9. Over the last six months, insiders were net buyers of 613,552 shares, which represents about 2.16% of the company's 28.42M share float.
2. American Public Education, Inc. (APEI): Provides online higher education focused primarily on serving the military and public service communities. Market cap at $666.04M. Price at $37.87. PEG at 0.81. P/FCF at 14.73. Over the last six months, insiders were net buyers of 283,600 shares, which represents about 1.69% of the company's 16.83M share float.
3. VSE Corp. (VSEC): Focuses on providing sustainment services for legacy systems and equipment. Market cap at $115.59M. Price at $21.91. PEG at 0.73. P/FCF at 3.6. Over the last six months, insiders were net buyers of 57,786 shares, which represents about 1.42% of the company's 4.08M share float.
*Insider data sourced from YahooFinance, 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.