Top 5 Insider Buys For The Week Ending August 10

Includes: CAR, DOLE, FB, IMAX, SGA
by: Markus Aarnio

Insider buying is often a sign of potential positive developments within a company, particularly if the insiders who are buying have a good track record with respect to their own buying. This is, however, only a secondary indicator and should not be relied upon solely when making the decision whether or not to purchase a security. Insider buying in and of itself will not make a stock go higher, but can provide a further clue if all the other pieces of the puzzle (e.g., earnings, sales, return on equity, profit margins, etc.) are in place.

I screened for companies where at least one insider made a buy worth over $1 million filed during August 6 to August 10. Here are the five stocks:

1. Dole Food Company (NYSE:DOLE) engages in sourcing, growing, processing, marketing, and distributing fresh fruits and vegetables, and food products to wholesale, retail, and institutional customers worldwide. It operates in three segments: Fresh Fruit, Fresh Vegetables, and Packaged Foods.

Insider buys

David Murdock purchased 789,500 shares on August 6-8, 411,600 shares on August 2-3, 617,400 shares on July 30 - August 1 and 278,800 shares on July 24-25. The company has 88,946,386 shares outstanding. Mr. Murdock has beneficial ownership of an aggregate of 53,807,300 shares or 60.5% of the company's stock. Mr. Murdock, 86, joined Dole as Chairman of the Board and Chief Executive Officer in July 1985.


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

Revenue $1.7 billion
Earnings per share $0.73
Cash $94.7 million

David A. DeLorenzo, Dole's President and CEO on company's strategic review during second quarter earnings announcement:

"We are continuing to look at a wide variety of potential alternatives as part of the strategic review of our businesses. As part of this review, we are exploring transactions that may include a full or partial separation of one or more of our businesses through a spin-off or other capital markets transaction, as well as joint venture and sale transactions, all of which are aimed at enhancing shareholder value. This review continues to be a company priority in our efforts to enhance shareholder value."

My analysis

The stock has a $24 price target from the Point and Figure chart. David Murdock has purchased a total of 2,097,300 shares since July 24.

2. IMAX Corporation (NYSE:IMAX) is one of the world's leading entertainment technology companies, specializing in immersive motion picture technologies. The worldwide IMAX theater network is among the most important and successful theatrical distribution platforms for major event Hollywood films around the globe, with IMAX theaters delivering the world's best cinematic presentations using proprietary IMAX, IMAX 3D, and IMAX DMR technology.

Insider buys

Kevin Douglas purchased 300,000 shares on August 7-8, 100,000 shares on July 20, 100,000 shares on July 17, 183,600 shares on July 12 and 326,400 shares on July 9. Mr. Douglas controls 8,736,447 shares currently. The company has 68.4 million shares outstanding, which makes Kevin Douglas a 12.7% owner of the company. Mr. Douglas is the founder and chairman of closely held Douglas Telecommunications, a San Rafael, California-based provider of VoiP telephone services.

My analysis

I wrote an article about IMAX on July 28. The stock has a $43.5 price target from the Point and Figure chart. Kevin Douglas has purchased 1,010,000 shares since July 9.

3. Zeltiq Aesthetics (NASDAQ:ZLTQ) is a medical technology company focused on developing and commercializing products utilizing its proprietary controlled-cooling technology platform. The company's first commercial product, the CoolSculpting System, selectively reduces stubborn fat bulges that may not respond to diet or exercise. CoolSculpting is clinically proven to reduce fat bulges in a 60-minute procedure, allowing patients to achieve noticeable and measurable aesthetic results. Zeltiq has received regulatory clearance from the U.S. Food and Drug Administration to market CoolSculpting in the United States for the selective reduction of fat around the flanks. Zeltiq has also received regulatory approval or is otherwise free to market CoolSculpting in 46 international markets.

Insider buys

Bryan Roberts purchased 685,000 shares on August 7 and 60,000 shares on August 2-6 through Venrock Associates V. Venrock Associates V currently controls 6,033,233 shares of the company. The company has 34.3 million shares outstanding which makes Bryan Roberts a 17.5% owner of the company. Bryan Roberts, Ph.D. has served on the company's Board of Directors since 2005.


The company reported the second-quarter financial results on July 31 with the following highlights:

Revenue $22.3 million
Net loss $0.24 per share
Cash $70.9 million

Mark Foley, Interim President and Chief Executive Officer, said,

"We are very pleased with our performance during the second quarter of 2012. Our recently strengthened commercial organization, combined with an increased focus on execution, successfully drove physician adoption of CoolSculpting, bringing our installed base to 1,257 systems worldwide. Additionally, we continued to experience significant procedure growth with procedure fee revenues up 84.9% year-over-year. During the quarter, we gained initial insights from our consumer marketing campaign and have begun to leverage these learnings to our future advertising spend. We also had several important intellectual property wins which further validate the proprietary position that we enjoy, worldwide."

He continued,

"Looking into the second half of 2012, we will continue to strengthen and expand our NAF sales organization, begin to realize the benefits of our recently completed transition to direct sales in Europe and selectively deploy direct to consumer marketing in key geographies in the United States. We continue to look forward to the increasing adoption of CoolSculpting by physicians and patients as we further build the non-invasive fat reduction market."

My analysis

The stock is down from a high of $15 in 2011 to the current $5 level. Bryan Roberts did buy some additional shares already in June 2012.

3. Saga Communications (NYSEMKT:SGA) is a broadcasting company whose business is devoted to acquiring, developing and operating broadcast properties. The company owns or operates broadcast properties in 26 markets, including 61 FM and 30 AM radio stations, 3 state radio networks, 2 farm radio networks, 5 television stations and 4 low-power television stations.

Insider buys

TowerView purchased 87,839 shares on August 8. TowerView has sole power to vote and sole power to dispose of an aggregate of 971,533 shares of common stock as of August 8, 2012, or 22.9% of the 4,246,000 shares of common stock that the company reported as outstanding as of June 30, 2012 in its Form 10-Q filed with the Securities and Exchange Commission on August 9, 2012. TowerView has used a total of $23,111,503 of its funds to purchase these shares.


The company reported the second-quarter financial results on August 7 with the following highlights:

Revenue $33 million
Earnings per share $1.21
Shares outstanding 4.2 million

My analysis

The stock is up from a $10 level in 2010 to the current $35 level. TowerView has been buying the shares all the way from 2010.

4. Zipcar (ZIP) is the world's leading car-sharing network with more than 731,000 members and 11,000 vehicles in urban areas and college campuses throughout the United States, Canada, the United Kingdom, Spain and Austria. Zipcar offers more than 30 makes and models of self-service vehicles by the hour or day to residents and businesses looking for an alternative to the high costs and hassles of owning a car.

Insider buys

Stephen Case purchased 265,976 shares on August 7-9 and currently controls 7,118,151 shares of the company. The company has 39.8 million shares outstanding which makes Stephen Case a 17.8% owner of the company. Stephen Case also serves as a director of the company.


The company reported the second-quarter financial results on August 2 with the following highlights:

Revenue $70.8 million
Net loss $0.01 per share
Cash $62.7 million


The company gave the following outlook on August 2:

For the full year 2012, revenue is now expected in the range of $272 million to $278 million. Full year 2012 Adjusted EBITDA is now expected to range from $12 million to $16 million and US GAAP net income is now expected to range from breakeven to $4 million. For the 2012 third quarter, Zipcar expects revenue in the range of $74 million to $77 million. Adjusted EBITDA for the period is expected to range from $2.5 million to $5 million and US GAAP net income is expected to range from a loss of $0.5 million to a profit of $2 million. Zipcar's average share count is expected to be between 39.5 million and 40.5 million for the third quarter and the full year. Common stock equivalents of approximately 1.5 to 2.5 million shares would be included to the extent Zipcar records positive US GAAP net income.

My analysis

The stock is down from a $30 level in 2011 to the current $8 level. This week's insider buy was the first in the company's history.

5. Facebook's (NASDAQ:FB) mission is to make the world more open and connected. People use Facebook to stay connected with friends and family, to discover what's going on in the world, and to share and express what matters to them.

Insider buys

Reed Hastings purchased 47,846 shares of the company on August 8. Reed Hastings serves as a director of the company.


The company reported the second-quarter financial results on July 26 with the following highlights:

Revenue $1.2 billion
Net loss (GAAP) $0.08 per share
Monthly active users 955 million

The company did not give any outlook or guidance during the earnings release. David Ebersman, Chief Financial Officer, only commented the following during the conference call:

As we look to the second half of 2012, we're encouraged that the network of people using Facebook continues to grow and their engagement is strong. We remain focused on building out better and deeper social experiences for the people who use Facebook, while at the same time executing on the monetization strategies and initiatives outlined today.

My analysis

This was the first insider buy since Facebook's IPO. The stock has fallen 50% since the IPO. If this turns out to be the bottom for the stock I would congratulate Reed Hastings on the timing.

Disclosure: I am long IMAX.

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