2 Major Insider Buys To Start The Week

Includes: IMAX, NAV
by: Markus Aarnio

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 worth over $1 million for this week. Here are two stocks that I found:

1. Navistar International Corporation (NAV) is a holding company whose subsidiaries and affiliates produce International brand commercial and military trucks, MaxxForce brand diesel engines, IC Bus brand school and commercial buses, Monaco RV brands of recreational vehicles, and Workhorse brand chassis for motor homes and step vans. The company is also a private-label designer and manufacturer of diesel engines for the pickup truck, van and SUV markets. While it also provides truck and diesel engine service parts, another affiliate offers financing services.

Click to enlarge
(Click to enlarge)

Insider buys

  • Carl Icahn purchased 226,774 shares on July 12th-July 16th. Carl Icahn currently controls 9,265,588 shares of Navistar. The company has 68.7 million shares outstanding, which makes Carl Icahn an 13.5% owner of the company. As of March 2012, Carl Icahn's net worth was estimated to be $14 billion.
  • Dr. Mark H. Rachesky, M.D., purchased 914,163 shares through his funds on July 9 and currently controls 14.95% of the company. Dr. Rachesky co-founded MHR Fund Management in 1996 and serves as its President. He served at Icahn Holding Corp. from February 1, 1990, to June 11, 1996, as the Managing Director.
  • Franklin Resources Inc. (BEN) filed an 18.8% ownership on July 10. Franklin Resources was an 12.4% owner as of May 10. Franklin Resources is a global investment management organization known as Franklin Templeton Investments. The company has an extensive global presence, including offices in over 30 countries and clients in more than 150.

2. IMAX Corporation (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.

Click to enlarge
(Click to enlarge)

Insider buys

  • Kevin Douglas purchased 183,600 shares on July 12th and 326,400 shares on July 9th. Kevin Douglas is an 10% owner according to SEC filings.


Navistar's three largest holders currently own 47% of the company and have been buying more this year. Shares of IMAX saw a breakout from the consolidation pattern as of July 17th.

Disclosure: I am long NAV.