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Wish you could get an inside peek at your favorite companies? One idea is to consider insider stock buying trends. To illustrate, we ran a screen.

We began by screening for stocks with the confidence of their company insiders, such as members of the board and upper management, with significant net insider purchases over the last six months representing at least 2% of share float. Since most companies only have a handful of company insiders, net insider purchases representing 2% of share float is a big show of confidence in their employer's prospects.

We then screened for those that may be undervalued, by comparing price trends to changes in EPS estimates over the last month.

Based on the assumption that P/E is equal to a constant k, increases in EPS should be matched by increases in price. When they don't match up, a mispricing may have occurred.

We screened for stocks with faster growth in EPS estimates than price over the last month, which may indicate that these names are being undervalued.

(click to enlarge)

Do you think these companies should be trading higher? 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. Carter's, Inc. (CRI): Designs, sources, and markets branded children's wear. Market cap at $2.96B, most recent closing price at $50.15. The EPS estimate for the company's current year increased from 2.48 to 2.66 over the last 30 days, an increase of 7.26%. This increase came during a time when the stock price changed by -1.55% (from 50.94 to 50.15 over the last 30 days). Over the last six months, insiders were net buyers of 1,110,366 shares, which represents about 2.55% of the company's 43.48M share float.

2. China TransInfo Technology Corp. (CTFO): Provides public transportation information technology systems and related technology solutions in China. Market cap at $114.22M, most recent closing price at $4.52. The EPS estimate for the company's current year increased from 0.46 to 0.53 over the last 30 days, an increase of 15.22%. This increase came during a time when the stock price changed by -2.8% (from 4.65 to 4.52 over the last 30 days). Over the last six months, insiders were net buyers of 569,135 shares, which represents about 5.31% of the company's 10.72M share float.

3. Gaylord Entertainment Co. (GET): Operates as a diversified hospitality and entertainment company in the United States. Market cap at $1.6B, most recent closing price at $32.74. The EPS estimate for the company's current year increased from 0.68 to 0.76 over the last 30 days, an increase of 11.76%. This increase came during a time when the stock price changed by 8.41% (from 30.2 to 32.74 over the last 30 days). Over the last six months, insiders were net buyers of 4,266,250 shares, which represents about 11.4% of the company's 37.41M share float.

4. Middleburg Financial Corporation (MBRG): Provides banking, fiduciary, and investment management services to individuals and small businesses. Market cap at $111.11M, most recent closing price at $15.85. The EPS estimate for the company's current year increased from 0.72 to 0.79 over the last 30 days, an increase of 9.72%. This increase came during a time when the stock price changed by -3.59% (from 16.44 to 15.85 over the last 30 days). Over the last six months, insiders were net buyers of 189,751 shares, which represents about 3.69% of the company's 5.14M share float.

5. Mueller Industries Inc. (MLI): Manufactures copper, brass, plastic, and aluminum products. It operates in two segments, Plumbing & Refrigeration, and Original Equipment Manufacturers. Market cap at $1.66B, most recent closing price at $43.44. The EPS estimate for the company's current year increased from 2.5 to 2.85 over the last 30 days, an increase of 14.%. This increase came during a time when the stock price changed by -1.61% (from 44.15 to 43.44 over the last 30 days). Over the last six months, insiders were net buyers of 6,496,626 shares, which represents about 17.32% of the company's 37.51M share float.

6. Wright Medical Group Inc. (WMGI): Engages in the design, manufacture, and marketing of devices and biologic products for the extremity, hip, and knee repair and reconstruction. Market cap at $774.8M, most recent closing price at $19.71. The EPS estimate for the company's current year increased from 0.16 to 0.19 over the last 30 days, an increase of 18.75%. This increase came during a time when the stock price changed by 8.6% (from 18.15 to 19.71 over the last 30 days). Over the last six months, insiders were net buyers of 1,922,404 shares, which represents about 6.52% of the company's 29.50M share float.

*Insider data sourced from Yahoo! Finance, all other data sourced from Finviz.

Source: 6 Insider Stock Picks Undervalued By EPS Trends