I sometimes wonder why the insiders are buying. Kind of like a big Packers fan that always bets the team will win. I'm sure they are seeing some improvement in numbers and some encouraging results in some areas. But also keep in mind the dollars they are buying with are actually small amounts to them. These are millionaires. Buying $100k worth of stock means nothing to them. Sometimes its for show. "Look at me, I'm buying stock, I must know some inside secret!" I've seen similar amounts bet on a Kentucky Derby superfecta, and believe me, the only inside knowledge there was Mark Belling's opinion. BTW - we won. But thats not the point. And insider buying stock is like me making a $1000 wager on a horse race. Should someone bet on that race just because I bet $1000? Of course not. Sometimes inside information is worthless. Do the insiders really know just how many new Meijer stores are planned? How many more Walmarts are planned that have not been announced? I've been on the inside and I can tell you that denial is often the main theme of a strategy meeting. "oh that Walmart, they won't come here, we are just too strong." "If we get in first, and are priced right, Meijer will back down." "Hy-Vee will never come to Wisconsin, the unions will scare them away" Football players used to be so confident in themselves they would make wagers they would win. Thats great right? Then after they bet they find out that a key player can no longer hide his injury and now the bet doesn't look so smart. Then there is always the double cross. Sometimes a person does not buy stock because its a good investment. I've actually done it because I was able to buy a small amount of a lightly traded stock and personally increase the price by 20% with my trade. It could just be one retirement account selling to another retirement account. Then people see the price rise 20%, assume something is happening, try to jump in and buy, and I sell them stock at a 20% premium. Then the price goes back down. Sometimes inside buying is just for show, using small trades to give the impression something is happening. NO, it isnt' but if the insiders start buying stock worth millions, then you know they are serious. But $100k is a petty small amount.
I also wonder if insider buying is do to high level employees being hen pecked or bullied into buying. The leading by being loud method. They sold at nearly double the current price and are buying back at a huge discount. Seems like short selling in a way. Maybe they got a lecture like this "we pay you hundreds of thousands of dollars, we have made you a millionaire, you sold out at a nice price, now go buy some of it back and show our employees and the investor community you have faith in the company. If we sell out you will probably get your money back, or most of it anyway. If you lose it all it won't make difference in your lifestyle. You need to have some skin in game. If you are a good sport we won't make you give anything to United Way where all you get is a tax deduction." A small cap stock is like a low handle horse track. It doesn't take much money in the win pool to make any horse the favorite. Uninformed bettors see a 10 to 1 morning line nag being bet down to 3 to 1 with a $25,000 bet. The suckers fall for it, and bet it down to 2 to 1. Then the smart money is dropping $25,000 on the real winner at every race book from Reno to Vegas where its excluded from the parimutuel pools..
Your post mentioned Mark Belling. Wonder what his opinion is on Roundy's. Has Mark ever commented on this company,be it positive or negative. I often listen to his afternoon show and have never heard him comment on Roundy's. I do remember him having an opinion on Pabst farms.That was a couple of years ago. Just wondering.....
Mark knows whats going on just from the visual. He sees what we all see. Plummeting sales and stock price due to and onslaught of new competitors. But if I were to guess, he doesn't realize the severity because he probably has not spent the time many of us have in all the micro and macro analysis. The only thing I've ever discussed with him is horse racing. If you bet Triple Crown races, he is one of the best handicappers I've ever met. I've got a nice ROI on those races using his picks. He knows his horses, trainers, and has good inside connections.
On my winning Derby bet, I placed it from a Jai Alai place near Miami - avoid Wisconsin taxes. Then back hauled the cash from West Palm Beach on the company plane after they dropped off a former stockholder who lived in the area. Those were the good old days. I think the most knowledgeable employees were the company pilots. If you knew where the plane was heading and the passenger manifest, you could easily speculate what was going down. For a long time one of my jobs was to track the tail numbers of competitors planes. I think the FAA has come up with something now to keep you from tracking private aircraft.