Following corporate insiders and management can be a good gauge of which way a stock may be ready to go. Often, insiders will buy stock when a headline or other unseen events knock the price down. CEOs and insiders may have many reasons to sell their own company’s shares, but when they buy the stock outright in the market, the general view is that they think the stock is undervalued or is about to go higher in the weeks or months ahead.
At 24/7 Wall Street we like to follow insider transactions and pass them along as soon as they hit. Here are some of the prominent insider buys for this week.
Republic Services Inc. (NYSE: RSG) saw a monster buy of 1.4 million shares purchased for between $36.58 and $36.80 for $42 million. The buyer was none other than Cascade Investments, the investment platform for Microsoft founder Bill Gates. Gates has been a long time holder now and even has one of his team on the board. Republic shares traded at $37.37 Friday.
Prospect Capital Corp. (NASDAQ: PSEC) saw solid insider buying from three executives. Prospect Capital is a business development company that recently received a favorable SEC ruling on its accounting status. The uncertainty had knocked the shares down. The CEO, COO and CFO bought a total of 255,000 shares between $10.25 and $10.37 valued at $2.6 million. Shares were trading at $10.36 on Friday.
Rally Software Development Corp. (NYSE: RALY) saw the CEO and two members of the board of directors step up and buy shares. Between the three, a total of 85,000 shares were bought at prices ranging from $9.15 to $9.21, for a total of $800,000. Shares were trading at $10.44 Friday afternoon.
Mattress Firm Holding Corp. (NASDAQ: MFRM), a senior vice president of finance bought 5,326 shares at $46.70 for a total of $300,000. While not a multimillion dollar purchase, this is pretty solid insider purchase by an individual. The stock was trading Friday at $46.60, down almost $2 from the highs of this week.
Endurance Specialty Holdings Ltd. (NYSE: ENH) Chairman and CEO John Charman stepped up to the plate and purchase 13,929 shares. He bought these shares at the average price of $51.17 per share for a total transaction amount of $712,747. On June 11, he made an even larger insider buy into his company. He added 35,630 shares to his holdings at $40.96 per share. This transaction cost the CEO a total of $1,459,405. Since his buy, the price per share has increased approximately 25.98%. Endurance shares were trading at $51.62 Friday.