Very Strong Insider Purchasing In These Unique Companies

by: Brian Gorban

There are a number of reasons company insiders will sell their stock, however they will only purchase for one reason: to make more money. Therefore, we routinely look to see any notable insider purchases and found some here.

Doral Financial Corporation (DRL), through its subsidiaries, provides banking, mortgage banking, and insurance services in Puerto Rico, New York, and Florida. On Dec. 16, President and CEO Glen Wakeman bought a massive 735,835 shares. DRL is trading right near a 52-week low and has some attractive valuations at just .2x P/B and .3x P/S.

Och-Ziff Capital Management Group LLC (OZM) is a publicly owned investment manager. On Dec. 15, CEO Daniel Och bought a considerable 91,790 shares. The company has had a bad year sitting right near a 52-week low, but has some attractive valuations now at just .8x P/S, 1x PEG, and 2.4x EV/EBITDA.

OPKO Health (OPK), a pharmaceutical and diagnostics company, engages in the discovery, development, and commercialization of novel and proprietary technologies. On Dec. 13, Chairman and CEO Phillip Frost bought another 20,000 shares, which is in addition to many recent purchases he's made as I described here. I'll continue to say this is a nice speculative buy as the financials aren't pretty with the stock trading at 30x EV/S, 13x P/B, and approximately negative $20M in FCF this past year. But I do agree it has great potential and an excellent management team. Moreover, Dr. Frost's track record is excellent which is definitely worth noting.

Republic Services, Inc. (RSG) provides non-hazardous solid waste collection, transfer, and disposal services for commercial, industrial, municipal, and residential customers. On Dec. 9, Bill Gates investment fund, Cascade Investments, bought a huge 500,000 shares on the open market. This isn't his first purchase of RSG as we described here and the value looks clear with RSG trading at a reasonable 18x trailing P/E, 13x forward P/E, 1x PEG, under 7x EV/EBITDA, and consistently growing 3.3% dividend yield.

CNO Financial Group, Inc. (CNO), through its subsidiaries, engages in the development, marketing, and administration of health insurance, annuity, individual life insurance, and other insurance products for senior and middle-income markets in the United States. On Dec. 19, board director Keith Long bought 25,000 shares on the open market. The company looks to have great value now at just a 4x trailing P/E, 9x forward P/E, .3x P/S and P/B, .9x PEG and EV/S, and under 4x EV/EBITDA.

EXCO Resources, Inc. (XCO), an independent oil and natural gas company, engages in the exploration, exploitation, development, and production of onshore North American oil and natural gas properties with a focus on shale resource plays. On Dec. 14, major shareholder Oaktree Funds bought a massive 2 million shares. The company is now trading at an 18x trailing P/E, 11x forward P/E, .6x PEG, 1.1x P/B, and respectable 1.6% dividend yield.

VMware, Inc. (VMW) provides virtualization and virtualization-based cloud infrastructure solutions primarily in the United States. On Dec. 13, major shareholder EMC bought a big 171,800 shares. We discussed about VMW previously here and trades now at a trailing 57x P/E, 34x forward P/E, 37x EV/EBITDA, and 10x P/S.

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