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5 Noteworthy Insider Transactions Filed on Friday Amid Slowing Insider Trading Activity

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U.S. equities rallied on Friday as the Labor Department revealed that U.S employers added 287,000 jobs in June, a big turnaround from the weak reports released for April and May, showing that the U.S economy has not run out of steam just yet. The Dow Jones Industrial Average is approximately 200 points below its all-time high reached in May 2015, so one may anticipate insider selling to accelerate in the foreseeable future. After all, corporate insiders usually follow the pattern of ‘buying low and selling high’.

Last week’s dollar volume of insider buying slightly declined relative to the previous week, whereas the dollar value of insider selling more than halved week-over-week. The insider selling-to-buying ratio stood at 9.7-to-1 for the past week, which means that insiders sold almost ten shares for each share bought. Investors should keep in mind that corporate insiders, namely executives and Board members, know more about their companies than anyone else, which is why insider trading metrics should be closely monitored on a daily basis. With this in mind, the following article will discuss a series of noteworthy insider purchases and sales reported with the SEC on Friday.

Academic research has shown that certain insider purchases historically outperformed the market by an average of seven percentage points per year. This effect is more pronounced in small-cap stocks. Another exception is the small-cap stock picks of hedge funds. Our research has shown that imitating the 15 most popular small-cap stocks among hedge funds outperformed the market by nearly a percentage point per month between 1999 and 2012 (read more details here).

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Boutique Operator Registers More Insider Buying

The insider buying activity at Francesca’s Holdings Corp (NASDAQ:FRAN) has been gaining steam lately as the shares of the specialty retailer, which operates a nationwide-chain of boutiques, are down by 31% year-to-date. Laurie Hummel, Executive Vice President and Chief Merchandising Officer, filed Friday to disclose the purchase of 7,000 shares for $10.97 each, which boosted her overall holding to 34,332 shares. The purchase was conducted on June 30.

Francesca’s Holdings Corp (NASDAQ:FRAN)’s stock performance has been weighed down by the resignation of Michael W. Barnes from his positions as Chairman, President and CEO of the company in mid-May, after running the company for less than two years. Immediately after the announcement of the resignation, Jefferies analysts downgraded the stock to ‘Hold’ and cut their price target on it to $11 from $22, saying that Mr. Barnes’ departure was disappointing. Mariko Gordon’s Daruma Asset Management was the owner of 2.93 million shares of Francesca’s Holdings Corp (NASDAQ:FRAN) at the end of March.

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The CEO of This Low-Priced Biotechnology Company Keeps Buying Shares

After purchasing an aggregate of 171,000 shares in late June and early July, the man in charge of Hemispherx BioPharma Inc. (NYSEMKT:HEB) purchased an additional 48,000 shares on Friday at roughly $0.12 apiece. After the recent purchase, President and CEO Thomas K. Equels currently holds a stake of 1.70 million shares.

The specialty pharmaceutical company’s flagship products include Alferon N Injection, a genital warts treatment, as well as the experimental therapeutic called Ampligen. Just recently, the Philadelphia-based Hemispherx BioPharma Inc. (NYSEMKT:HEB) obtained the intellectual property rights for the two products, which were held by former CEO Dr. William A. Carter, which adds assurances that he will not make future intellectual property claims. This means the biotechnology company can fully focus on its strategy to seek licensing deals or development partnerships with other biopharmaceutical firms, to advance the development of the two products without facing the possibility of investors or potential co-development partners raising concerns. Hemispherx shares are up by 48% thus far in 2016. Jim Simons’ Renaissance Technologies had 1.85 million shares of Hemispherx BioPharma Inc. (NYSEMKT:HEB) in its portfolio on March 31.

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The second page of this insider trading article will discuss the fresh insider selling registered at three companies.

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