With the stock market continuing to move higher, the conventional wisdom would be that insider buying will slow down. Not only is that not the case, this week the insider buying data that hit our screens showed not only a marked increase in the trade size, but also in the dollar values. Insiders continuing to buy stock when the market is making or breaking all-time highs is an incredibly bullish sign for stock investors.
We cover insider buying every week at 24/7 Wall St., and with earnings blackouts starting to be lifted, we are seeing some strong participation from executives and 10% institutional holders.
Here are this past week’s companies that reported insider buying.
Mondelez International Inc. (NASDAQ: MDLZ) saw a gigantic insider buy that should make shareholders very excited. A director bought a huge block of 915,000 shares at $36.97 apiece. The total purchase came to a stunning $33.8 million. The company announced this week that, as part of its ongoing efforts to further focus its portfolio on snacking products, it has reached an agreement to sell its 50% interest in Ajinomoto General Foods (AGF) to its joint venture partner, Ajinomoto. AGF manufactures and sells instant, ground and liquid coffee products, as well as other beverages, in Japan under brands mainly licensed by Mondelez, including Blendy and Maxim. Shares closed trading Friday at $36.94, in line with the huge insider buy.
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General Electric Co. (NYSE: GE) has not participated in the rally, so disappointed shareholders will be thrilled to know that a director at the company bought a 400,000 share block of the blue-chip industrial’s stock last week at a share price of $25. The total purchase came to $10 million. With the stock trading essentially where it was this time last year, this is a very positive turn of events. The shares ended trading on Friday at $25.99, so a well-timed buy.
NuStar Energy L.P. (NYSE: NS) is yet another company in which a director made a significant purchase this past week. That director purchased 74,460 shares of the master limited partnership at prices that ranged from $61.10 to $61.30. The total buy came to $4.6 million. NuStar is engaged in the terminalling, storage and marketing of petroleum products, as well as the transportation of petroleum products and anhydrous ammonia, primarily in the United States and the Netherlands. Shares ended the week at $63.04, so another well-timed purchase.
Dominion Resources Inc. (NYSE: D) is a major utility that saw four directors buy stock in the company last week. They picked up a total of 41,850 shares at prices that ranged from $73.50 to $73.90. Dominion’s shares have declined about 10% since the beginning of the year, so this is a positive sign for shareholders. The stock was trading at $72.09 on Friday’s close.
E.I. du Pont de Nemours and Co. (NYSE: DD), better known to investors as just DuPont, also had a director at the company make a sizable purchase this week. That director bought 16,000 shares at prices that ranged from $77.18 to $77.39. The total buy came to a tidy $1.27 million. DuPont shares closed trading Friday at $77.85, slightly higher than the buy level.
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These companies also reported insider buying this week: Coca-Cola Co. (NYSE: KO), Cooper Tire & Rubber Co. (NYSE: CTB), Seattle Genetics Inc. (NASDAQ: SGEN), TrueCar Inc. (NASDAQ: TRUE) and Xerium Technologies Inc. (NYSE: XRM).
Insiders buying huge blocks of blue-chip stocks is a very positive sign for the overall market. We will be tracking this trend in the coming weeks to see if more insiders step up to the plate and acquire stock, especially those that have traded poorly in such a strong bull market.
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