- Insider buying can be an encouraging signal for potential investors.
- Some insiders made return trips to the buy window in the past week.
- A biotech CEO continued a streak of share-buying.
Conventional wisdom says that 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, but also note that Richard Kinder, executive board chair of Kinder Morgan Inc (NYSE: KMI), has continued his long streak of scooping up shares of the company.
Zillow Group Inc (NASDAQ: Z) had a director return for more notable indirect share purchases this past week. At $41.71 to $42.37 apiece, the 690,000 shares acquired most recently totaled around $29.01 million. Note that this director also bought over $58.6 million worth of the shares in the previous week.
Zillow's new business in buying and selling homes has helped boost its revenue. Its shares ended Friday trading at $43.02, above the director's latest purchase price range, after rising more than 2 percent in the past week. The Wall Street consensus price objective is just $36.67, but the shares have traded as high as $65.70 in the past 52 weeks. They also have changed hands as low as $26.38 apiece.
Coty Inc (NYSE: COTY) saw a director return to the buy window for almost 1.27 million more shares of this beauty products company. At prices ranging from $12.85 to $13.05 per share, that cost him more than $16.43 million. Note that that director and some company executives, including the CEO, have acquired more than 7.12 million shares over the course of May.
Coty had a common stock offering following its mixed third-quarter report earlier in the month. The stock ended the past week at $12.34 per share, below the purchase price noted above, after pulling back more than 5 percent in the past week. While the consensus target was last seen at just $11.99, the stock has traded as high as $14.87 in the past 52 weeks.
Last week, the Intrexon Corp (NASDAQ: XON) CEO, Kirk Randal, indirectly acquired more than 825,000 shares of this biotech company. At prices ranging from $4.68 to $4.79 per share, the total was nearly $3.92 million. These purchases were an extension of a buying streak that goes back to before mid-May.
This Maryland-based company posted disappointing earnings results earlier this month, prompting CNBC's Jim Cramer to call it a "loser." Its shares ended the past week trading at $4.84, after rising about 4%. That was above the purchase price range noted above. The consensus target is $9.67, though the stock has traded as high as $19.94 in the past 52 weeks.
Last week, The Medicines Company (NASDAQ: MDCO) saw a director indirectly acquire an additional 85,000 shares of this biopharmaceutical company at an average of $34.83 apiece. The transactions totaled around $2.96 million. Note that this same director purchased 431,000 shares in the previous week, and the director's stake was listed as more than 4.15 million shares.
Shares of this New Jersey-based company rallied after it released positive midstage study results for its lead product candidate Inclisiran, a cholesterol-lowering therapy. The stock ended the week more than 3 percent higher and closed most recently at $35.65, so again the director's latest purchases seem to be well timed. Note that shares have traded as high as $41.57 in the past 52 weeks, but the analysts' consensus price target is $53.57.
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