When insiders buy shares on the open market, their companies are usually undervalued. Corporate insiders often have the inside track on their companies' prospects. Insiders probably wouldn't risk investing too much of their own money into their own companies unless they thought the stock might rise.
I screened for companies where at least one insider made an insider buy during the last three trading days. Here are three services sector stocks that I found:
1. Hudson Global (NASDAQ:HSON) is a leading provider of permanent recruitment, contract professionals and talent management services worldwide. From single placements to total project solutions, Hudson helps clients achieve greater organizational performance by assessing, recruiting, developing and engaging the best and brightest people for their businesses. The company employs more than 2,000 professionals serving clients and candidates in approximately 20 countries.
- Sagard Capital Partners purchased 150,000 shares on July 9th and currently controls 4,041,448 shares of the company. Sagard Capital Partners has purchased 705,000 shares since June 20th. The company has 31.8 million shares outstanding which creates Sagard Capital Partners an 12.6% owner of the company.
2. JTH Holding (NASDAQ:TAX) is the parent company of Liberty Tax Service. Liberty Tax Service is the fastest-growing retail tax preparation company in the industry's history. Founded in 1997 by CEO John Hewitt, a pioneer in the tax industry, Liberty Tax Service has prepared over 10 million individual income tax returns. With 43 years of tax industry experience, Hewitt stands as the most experienced CEO in the tax preparation business, having also founded Jackson Hewitt Tax Service. Liberty Tax Service is the only tax franchise on the recently released Forbes "Top 20 Franchises for the Buck."
- James Wheaton purchased 4,000 shares on July 10th. Mr. Wheaton has served as the company's General Counsel and Vice President of Legal and Governmental Affairs since February 2011.
- Thomas Daniels purchased 3,000 shares on July 3rd. Mr. Daniels serves as Chief Accounting Officer of the company.
- John Hewitt purchased 5,000 shares on June 26th and currently holds 1,042,510 shares of the company. Mr. Hewitt has served as the company's Chairman, Chief Executive Officer and President since October 1996.
3. IMAX Corporation (NYSE:IMAX) is one of the world's leading entertainment technology companies, specializing in immersive motion picture technologies. The worldwide IMAX theatre network is among the most important and successful theatrical distribution platforms for major event Hollywood films around the globe, with IMAX theatres delivering the world's best cinematic presentations using proprietary IMAX, IMAX 3D, and IMAX DMR technology.
- Kevin Douglas purchased 326,400 shares on July 9th. Kevin Douglas is an 10% owner according to SEC filings.
JTH Holding just became public on July 2nd. IMAX is currently in a bullish looking consolidation pattern waiting for upside breakout. Hudson Global is currently trading below its 200 day moving average, a daily close above $4.50 would be a bullish sign for the stock.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.