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 trading under $5 a share that have strong upward momentum, trading above their 20-day, 50-day, and 200-day moving averages.
We then screened these names for those 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. Since most companies only have a handful of company insiders, net insider purchases representing 1.5% of share float is a big show of confidence in their employer's prospects.
For an interactive version of this chart, click on the image below. Analyst ratings sourced from Zacks Investment Research.
Tool provided by Kapitall (kapitall.com).
Do you think these insiders are calling it right on their companies? Use this list as a starting point for your own analysis.
List sorted by net insider purchases as a percent of share float.
1. EnteroMedics, Inc. (ETRM): Focuses on the design and development of devices that use neuroblocking technology to treat obesity and associated co-morbidities, and other gastrointestinal disorders. Market cap at $169.43M, most recent closing price at $4.34. The stock is trading 18.91% above its 20-day moving average, 26.17% above its 50-day MA, and 77.32% above its 200-day MA. Over the last six months, insiders were net buyers of 2,164,479 shares, which represents about 14.75% of the company's 14.67M share float.
2. GTX Inc. (GTXI): Engages in the discovery, development, and commercialization of small molecules to treat cancer, osteoporosis and bone loss, muscle loss, and other serious medical conditions. Market cap at $232.36M, most recent closing price at $3.70. The stock is trading 4.56% above its 20-day moving average, 13.37% above its 50-day MA, and 2.20% above its 200-day MA. Over the last six months, insiders were net buyers of 795,478 shares, which represents about 3.2% of the company's 24.88M share float.
3. Support.com, Inc. (SPRT): Provides online care services for the digital home and small business primarily in North America. Market cap at $153.44M, most recent closing price at $3.15. The stock is trading 0.42% above its 20-day moving average, 10.00% above its 50-day MA, and 16.81% above its 200-day MA. Over the last six months, insiders were net buyers of 608,386 shares, which represents about 1.58% of the company's 38.58M share float.
*Insider data sourced from Yahoo! Finance, 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.