- Insider buying can be an encouraging signal for potential investors.
- An executive chair continuing making "very extreme" purchases in the past week.
- A couple of CEOs put their money where their mouths are with notable buys as well.
Conventional wisdom says insiders and 10 percent owners really only buy shares of a company for one reason -- they believe the stock price will rise and they want to profit from it. So insider buying can be an encouraging signal for potential investors, particularly during periods of uncertainty.
Here's a look at a few notable insider purchases reported in the past week.
Hain Celestial Group Inc (NASDAQ: HAIN) saw a director make a few more notable share purchases this past week. At $19.96 to $21.29 apiece, the more than 3.9 million shares acquired totaled nearly $82.39 million. His stake was listed as almost 4.1 million shares, compared with more than 104 million shares outstanding.
This maker of organic and natural products has seen both an upgrade and a downgrade from analysts recently. Shares ended Friday at $21.50, just the director's purchase price range, after a more than 10-percent pop in the past week. The consensus price target is $20.13, but shares have traded as high as $36.15 in the past 52 weeks.
In the past week, The Medicines Company (NASDAQ: MDCO) saw a director building up his stake some more. At prices that ranged from $24.84 to $26.07 per share, the 755,000 shares acquired altogether totaled over $19.19 million. That same director also purchased 100,000 shares in the previous week.
This company divested all its marketed products in 2018 as part of a restructuring to focus solely on developing its late-stage candidate, inclisiran. The stock ended last week at $25.17 per share, which is still within the above purchase price range. While the consensus target was last seen at $46.15, the stock has traded as high as $41.57 in the past 52 weeks.
The Kinder Morgan Inc (NYSE: KMI) executive chair of the board, Richard Kinder, picked up more than 211,000 additional shares of this Houston-based energy infrastructure giant. At prices that ranged from $19.58 to $19.70 a share, last week's transactions totaled more than $4.15 million.
Barron's recently had a few thoughts on what the "very extreme" insider buying at Kinder Morgan may mean. The stock has rallied over 28 percent year to date and closed Friday at $19.73, just above Kinder's latest purchase price range. Shares traded between $14.62 and $20.01 in the past 52 weeks, but analysts anticipate the price will go to $21.37.
Pursuant to a Rule 10b5-1 trading plan, chief executive and board chair, John Plant, scooped up a total of 105,000 Arconic Inc (NYSE: ARNC) shares last week. At between $18.03 and $18.94 apiece, that cost him some $1.94 million. And it raised his stake to 115,000 shares.
This lightweight metals engineering and manufacturing company chopped its dividend and boosted its share buyback plan in February. Its share price pulled back marginally last week and closedon Friday at $18.49. The stock has traded between $ 15.63 and $25.24 in the past 52 weeks, and analysts currently estimate the price will go as high as $21.63.
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Centurylink Inc (NYSE: CTL) saw CEO Jeffrey Storey, another executive and a director all step up to the buy window midweek. At prices that ranged from $14.55 to $15.10 apiece, the 141,000 shares reportedly acquired cost them over $1.67 million. Note that Storey's stake was listed as up to more than 3.4 million shares.
This Louisiana-based telecom last week announced a delay in filing its 10-K, citing recently identified material weaknesses in internal controls. Shares ended Friday trading at $12.30 apiece, down about 4 percent for the week. The stock has traded as high as $24.20 in the past year, and the consensus price target was $14.07 on last look.
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