Insider buying can be an encouraging signal for potential investors.
A packaged food giant and two drugmakers saw notable insider buying activity this past week.
Some of this insider buying occurred alongside insider sales.
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 with markets near all-time highs.
The following are some notable insider purchases reported in the past week.
Kraft Heinz Co (NASDAQ: KHC) saw two directors buying some shares last week. At $28.27 to $28.60 apiece, the almost 3.75 million shares reportedly acquired altogether totaled more than $107.11 million. Note that the larger of the two purchases was pursuant to Rule 144(g).
Also note a large sale of shares this past week by a beneficial owner. Shares were trading at $28.14 apiece on last look, just below the above purchase price range. The stock has changed hands as high as $58.08 a share in the past year, but the analysts' consensus price target is just $28.39.
A beneficial owner of ACADIA Pharmaceuticals Inc. (NASDAQ: ACAD) purchased more than 1.56 million shares of this biopharmaceutical company. At $40 per share, the transaction totaled $62.5 million. That brought the stake to almost 37.5 million shares in a total float of over 144 million.
The purchase was part of a 6.25-million share common stock offering last week. The stock was last seen trading at $34.35 a share in a 52-week range of $22.94 to $39.74.
The consensus analyst price target is $44.83, with a consensus recommendation to buy shares.
A Scientific Games Corp (NASDAQ: SGMS) director stepped up to the buy window midweek.
That director picked up 100,000 more shares of this maker of slot machines and other gaming products at $21.83 to $22.62 apiece last week. The transaction totaled more than $2.24 million.
Note that another director sold more than 45,000 shares at about the same time. The stock closed most recently at $22.97, which is above the purchase price range above.
Shares have traded as high as $29.95 in the past 52 weeks, but analysts currently anticipate the price will only go to $29.44.
After two executives bought AbbVie Inc (NYSE: ABBV) shares in August, a vice chair now has stepped up to the buy window.
At $69.86 to $70.73 apiece, the 25,000 shares acquired most recently totaled more than $1.76 million. This purchase was made pursuant to a plan complying with Rule 10b5-1(c).
Investors hate the deal to buy Allergan, according to Barron's. AbbVie shares ended the week at $72.39, well above the purchase price range, after climbing more than 3% in the past week. The consensus price target is $86.27, but shares have traded as high as $96.60 in the past 52 weeks.
See also: Patrick Byrne Sells All of His Overstock Shares Following Crypto Dividend Scheme
Also note that a beneficial owner's buying streak at Sunrun Inc (NASDAQ: RUN) continued in the past week as well.
At the time of this writing, the author had no position in the mentioned equities.
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