Overall, if there is insider buying, it could be a bullish sign for a company’s stock.
Insiders have access to confidential information. Unfortunately, some insiders have used this information to gain an advantage over members of the public who do not have access to it.
For example, if an insider may knows news is about to be released that could move the stock price higher, they could go into the market and buy shares from someone who doesn’t have access to the news.
Sure, many regulations have been established by the U.S. Securities and Exchange Commission (SEC) that are meant to prevent this type of activity. One of them is a law that insiders must publicly disclose when they are buying or selling their company’s stock.
In turn, this allows outsiders to find profit opportunities. Thus, insider buying could be a bullish sign for a stock.
Moreover, a company insider may sell their stock for many reasons. They could need to raise money for things such as buying a house or diversifying into other assets.
But there is only one reason why an insider would buy their stock. They believe that it is undervalued and that the price of the shares will rise.
That said, there are a few names out there that I’ve found with some insider buying of their own. They are:
- Cyclo Therapeutics (NASDAQ:CYTH)
- Sierra Bancorp (NASDAQ:BSRR)
- Virios Therapeutics (NASDAQ:VIRI)
- Fastenal (NASDAQ:FAST)
- Brown & Brown Inc. (NYSE:BRO)
- Chemung Financial (NYSE:CHMG)
- Surgalign (NASDAQ:SRGA)
Now, let’s dive in and take a closer look at each one.
Stocks With Insider Buying: Cyclo Therapeutics (CYTH)
Cyclo Therapeutics is a biotechnology company that develops cyclodextrin-based products for the treatment of diseases. The company was founded in 1990, and is based in Gainesville, Florida.
As you can see on the above chart, shares of Cyclo have been trending lower over the past year. Last March, they traded above the $25 level. They fell to below $5 in December, but have since recovered some. They are currently trading around the $10.50 level.
Furthermore, Markus Sieger is a director of Cyclo. He just made a personal investment on Jan. 25 and Jan. 26. And he bought shares at a couple different prices each day. 26th.
Sieger is already making money. CYTH is currently trading around $10.70 per share. And if Maxim Group is correct, shares should continue to move higher. This is the only broker that covers Cyclo, and they have a “buy” rating on it with a $12 target price.
Sierra Bancorp (BSRR)
Sierra Bancorp is a bank holding company that provides both retail and commercial banking services to people and businesses in California
Over the past month, shareholders of this company lost a lot of money. As you can see on the above chart, shares of Sierra have been in a steep decline. The were trading around $26, but they have since dropped to current levels around $23.
Moreover, five Wall Street analysts follow Sierra. That said, all but one of them rated BSRR as a “hold.” And six analysts put the average price target at $27 per share.
Also, Julie Castle is a director of Sierra. She must also feel that shares are undervalued because she just made a significant personal investment. She recently spent about $90,000 when she bought 4,000 shares over two days.
Stocks With Insider Buying: Virios Therapeutics (VIRI)
Virios Therapeutics is a development-stage biotechnology company. It develops antiviral therapies that are used to treat diseases associated with abnormal immune responses. After the recent selloff, the market value is now about $63 million. Virios was founded in 2012 and it is based in Alpharetta, Georgia.
This company just went public in December at $10. And as you can see on the chart, has been in in a steep decline ever since. Share are currently trading around the $7.60 level.
However, at least two directors think that the shares are a good investment at current prices. And they just reported that they made investments recently. CEO and Founder Willian Pridgen just bought 3,500 shares at an average price of $7.47. And Angela Walsh, the vice president of finance, just reported buying 1,000 shares.
Fastenal (FAST)
Fastenal Company is a wholesale distributor of industrial and construction supplies. It operates worldwide, and their products include threaded fasteners, bolts, nuts, screws, studs, and related washers that are used in manufactured and construction projects. Fastenal Company is headquartered in Winona, Minnesota, and was founded in 1967.
Moreover, Fastenal has had a significant selloff over the past few weeks. Shares have dropped from around $51.50 to current levels around $47.
Collectively, this company has 18 different Wall Street firms following it. That said, nine rate it as a “hold” and six rate the stock as a buy — with an average price target of $51.
Additionally, Fastenal President and CEO Daniel Johnson must agree with the Street and believe that the stock is undervalued as well. He just made a personal investment of $50,000 when he bought 1,080 shares at an average price of $46.50.
Stocks With Insider Buying: Brown & Brown Inc. (BRO)
Brown & Brown is in the insurance business. It sells insurance products and services in the United States, England, Canada, Bermuda and the Cayman Islands. It was founded in 1939, and is headquartered in Daytona Beach, Florida.
As you can see on the above chart, it just a few weeks the share price has recently dropped by about 10%.
That said, this company is widely followed by Wall Street. In fact, 13 analysts reported their recommendations on the stock — with the majority rating it a “hold.” The average price target is $51.44.
James Hays is the vice chairman of the company. He must also believe that the shares are undervalued because on Jan. 29 he reported buying 10,000 shares at an average price of $43.38. Then, on Feb. 3, Executive Vice President and President Stephen Boyd purchased shares as well.
Chemung Financial (CHMG)
Chemung Financial provides a range of banking, financing, fiduciary, and other financial services. The company was founded in 1833, and is headquartered in Elmira, New York.
Overall, shares of Chemung have been steadily declining since November. They have dropped from $39 to current levels around $35.
That said, David Buicko is on the board of directors at Chemung. He must believe that now us a good time to buy the stock. He just made a $30,000 investment when he paid $33.75 per share for 893 shares.
Wall Street thinks that Chemung is undervalued as well. One firms follow and provide research on it, and they rate it as a “hold.” However, four analysts have the average price target at $38.25 per share.
At current levels, the price-earnings (P/E) ratio is low at about 9.8. Buicko may also be like the dividend the stock pays., with the current yield just over 3%.
Stocks With Insider Buying: Surgalign (SRGA)
Surgalign Holdings is a medical technology company that designs and develops biologic, metal, and synthetic implants. The company was founded in 1997 and its headquarters are in Deerfield, Illinois.
As you can see on the above chart, over the past year shares of SGRA stock have dropped from $5 to current levels around $2.70.
Also, there’s has been significant insider buying in Surgalign. These insiders must believe the stock is a great value around current prices.
Specifically, President and CEO Terry Rich made a significant personal investment. On Feb. 1, he paid $1.50 per share for 808,000 shares — representing a $1.2 million investment.
There were also significant purchases made by the chief commercial officer and at least three directors.
Additionally, seven analysts reported a price target for SRGA stock — with the average coming in at $5.
At the time of this publication, Mark Putrino did not have any positions (either directly or indirectly) in any of the aforementioned securities.