4 Major Insider Buys Filed On July 25th

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 |  Includes: CBRL, COF, NVR, POL
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 filed on July 25th. Here are four stocks that I found:

1. Cracker Barrel Old Country Store (CBRL) was established in 1969 in Lebanon, Tenn. and operates 615 company-owned locations in 42 states. Cracker Barrel Old Country Store provides a friendly home-away-from-home in its old country stores and restaurants. Guests are cared for like family while relaxing and enjoying real home-style food and shopping that's surprisingly unique, genuinely fun and reminiscent of America's country heritage … all at a fair price. The restaurant serves up delicious, home-style country food such as meatloaf and homemade chicken n' dumplings as well as its made from scratch biscuits using an old family recipe. The authentic old country retail store is fun to shop and offers unique gifts and self-indulgences.

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Insider buys

Sardar Biglari purchased 48,244 shares on July 23-25th and currently holds 4,064,509 shares of the company. The company has 23.5 million shares outstanding which makes Sardar Biglari a 17% owner. Sardar Biglari has purchased 1,776,522 shares since January 2012.

Financials

The company reported financial results for the third quarter of fiscal 2012 ended April 27, 2012 with the following highlights:

Revenue $608.5 million
Earnings $0.81 per share
Cash $127 million
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Outlook

The company expects total revenue for fiscal 2012 of between $2.55 billion and $2.6 billion, reflecting anticipated increases in comparable store restaurant and retail sales in a range of 1.5% and 2.0%, and the opening of 13 new Cracker Barrel stores in the current fiscal year. The company now expects to report adjusted earnings per diluted share for the fiscal year of between $4.35 and $4.45, excluding proxy contest and severance expenses totaling $0.21 per diluted share. On a GAAP basis, the company expects to report earnings per diluted share for the fiscal year of between $4.14 and $4.24.

My analysis

The stock has a $102 price target from the Point&Figure chart. I believe the target price is achievable in 1-2 years with the continued insider buying and earnings improvement.

2. PolyOne Corporation (POL) is a premier provider of specialized polymer materials, services and solutions. Headquartered outside Cleveland, Ohio USA, PolyOne has operations around the world. Consistent with the company's strategy of specialty growth and global expansion, in December of 2011 PolyOne acquired ColorMatrix Group, a highly specialized company with a premier suite of additive technologies and a leading market position in liquid colorants.

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Insider buys

  • Douglas Campbell purchased 81,150 shares during June 14th - July 6th and currently controls 218,934 shares of the company. Douglas Campbell is a Director of the company.
  • Richard Diemer purchased 15,000 shares on May 21st and 20,000 shares on May 7th. Richard Diemer currently holds 50,000 shares of the company. Mr. Diemer is senior vice president and chief financial officer of PolyOne Corporation. Mr. Diemer is responsible for global treasury, planning, M&A, accounting and internal audit functions, as well as investor relations.

Financials

The company's first quarter financial highlights include:

Revenue $781 million
Earnings $0.22
Cash $186 million
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By 2015 the company's goal is to achieve at least $2.50 of adjusted earnings per share on a $5 billion revenue base.

My analysis

The stock has a $26.5 price target from the Point&Figure chart. I believe the target price is achievable if the company can meet its financial goals.

3. Capital One Financial Corporation (COF) is a financial holding company whose subsidiaries, which include Capital One, Capital One Bank (USA), and ING Bank, had $213.9 billion in deposits and $296.6 billion in total assets outstanding as of June 30, 2012. Headquartered in McLean, Virginia, Capital One and ING Direct offer a broad spectrum of financial products and services to consumers, small businesses and commercial clients through a variety of channels. Capital One has approximately 1,000 branch locations primarily in New York, New Jersey, Texas, Louisiana, Maryland, Virginia and the District of Columbia.

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Insider buys

Groep Ing purchased 39,948 shares on July 23rd and currently holds 54,830,725 shares of the company. Groep Ing is a Director of the company.

Financials

The company reported second quarter earnings on July 18th with the following highlights:

Revenue $5.1 billion
Earnings $0.16 per share
Total assets $296.6 billion
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My analysis

The stock has a $70 price target from the Point&Figure chart. I believe the target price is achievable during next 12 months.

4. NVR Inc. (NVR) operates in two business segments: homebuilding and mortgage banking. The homebuilding unit sells and builds homes under the Ryan Homes, NVHomes and Fox Ridge Homes trade names, and operates in twenty-seven metropolitan areas in fifteen states. NVR Mortgage is headquartered in Reston, Virginia and operates branches in the metropolitan areas in which NVR has homebuilding operations. NVR Mortgage's primary focus is to serve the needs of NVR home buyers.

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Insider buys

Dwight Schar purchased 10,000 shares on July 25th and currently holds 80,523 shares of the company. Dwight Schar is a Director of the company.

Thomas Eckert purchased 200 shares on May 4th and currently holds 880 shares of the company. Thomas Eckert is a Director of the company.

Financials

The company reported second quarter results on July 19th with the following highlights:

Revenue $770 million
Earnings $8.97 per share
Cash $587 million
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My analysis

The stock has a $590 price target from the Point&Figure chart. The stock has found some support from its 200 day simple moving average which could prevent further fall down.

Disclosure: I have no positions in any stocks mentioned, but may initiate a long position in POL over the next 72 hours.