Insider buying can be an encouraging signal for potential investors.
A couple insiders were buying shares near 52-week highs.
Another insider more than doubled a stake in the past week.
- Conventional wisdom says that insiders and 10-percent owners only buy shares of a company for one reason — they believe the stock price will rise and they want to profit. So insider buying can be an encouraging signal for potential investors, particularly with markets at all-time highs.
Here's a look at a few notable insider purchases reported in the past week.
American Homes 4 Rent
American Homes 4 Rent (NYSE: AMH) saw two directors step up to the buy window this past week. The approximately 434,000 shares of this real estate investment trust that were acquired at per-share prices ranging from $22.72 to $23.22 3 altogether cost the directors nearly $9.97 million. Each of those directors has a stake of more than 13 million shares.
Shares of American Homes 4 Rent were hitting new 52-week highs as August came to a close. The stock ended the week trading at $22.87, still within the directors' purchase price range. The stock has changed hands between $18.39 and $23.34 in the past year, and the analyst's mean price target is $24.98.
Allergan plc (NYSE: AGN) saw a director more than double a stake last week. The 10,000 shares of this pharmaceutical company acquired, at per-share prices between $190.55 and $190.68, cost him more than $1.9 million. And note that two other directors also bought smaller batches of shares at the end of August.
Allergan got a snub from the FDA in August for its treatment of abnormal uterine bleeding. Its shares slipped less than 1 percent in the past week, and they were last seen trading at $190.24 apiece. That was less than the director's purchase price. The stock has traded as high as $237.41 a share in the past year, but the analysts' mean price target is $210.15.
A Tiffany & Co. (NYSE: TIF) director has picked up 50,000 shares of this luxury goods retailer so far this month. The share prices for these purchases ranged from $121.49 to $124.87, and the transactions totaled more than $6.19 million. Note that the transactions included some unvested restricted stock units.
Tiffany recently posted better-than-expected second-quarter results. The share price slipped about 2 percent but mostly recovered during the past week and closed on Friday at $122.87. While the stock has traded as high as $141.64 a share in the past year, the analysts' mean price target is $140.50.
At the time of this writing, the author had no position in the mentioned equities.
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