Insider buying can be an encouraging signal for potential investors.
A couple of board chairs increased their stakes last week.
Two of these companies are in the midst of restructuring.
Conventional wisdom says that insiders and 10% owners really 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 during periods of uncertainty. The following are some notable insider purchases reported in the past week:
Bunge Ltd (NYSE: BG) saw a director step up to the buy window again last week. At $52.01 to $52.50 each, the 125,000 shares reportedly acquired in the past week cost that director more than $6.54 million. The stake was last seen at more than 3.91 million shares, out of a total float near 137 million. This agribusiness and food company intends to move its global headquarters to St. Louis.
Shares were trading at $53.41 on last look, down about 3% since the announcement. The stock has changed hands as high as $72.35 a share in the past year. The consensus price target is $67.13.
The Kinder Morgan Inc (NYSE: KMI) executive chair of the board, Richard Kinder, recently resumed his buying. He picked up 300,000 more shares of this Houston-based energy infrastructure giant last week at $19.705 to $19.82 each. That totaled more than $5.92 million. Kinder Morgan says it aims to sell off its remaining stake in subsidiary Kinder Morgan Canada and to sell the U.S. portion of the Cochin Pipeline.
The stock pulled back about 2% last week and closed most recently at $20.27. That is above Kinder's latest purchase price range. Shares have traded between $14.62 and $21.50 in the past 52 weeks, and analysts anticipate the price will go to $22.05.
Rupert Murdoch, the Fox Corp (NYSE: FOX) board chair, purchased 500,000 class B shares of this broadcasting giant last week. At $31.65 to $32.25 per share, the transactions totaled more than $2.01 million. Murdoch also bought 1.2 million shares back in June, and another director picked up 3,000 shares earlier in August.
Fox reported better-than-expected fourth-quarter earnings recently, despite lower ad revenue and losses in cable subscribers. The class B shares were last seen trading at $32.80, above Murdoch's purchase price range, and in a 52-week range of $31.28 to $41.73. The analyst consensus price target is $51.50.
At the time of this writing, the author had no position in the mentioned equities.
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