Insider Buying at Coatings and Paints Company The Valspar Coporation (VAL)

Page 1 of 2

The Valspar Coporation (NYSE:VAL) was up about 13% for the year in late May, but over the last month the $5.5 billion market cap coatings and paints company has given up all of those gains. The primary culprit for the decline would appear to be the decision to acquire European coatings manufacturer Inver Group. The business is fairly small relative to The Valspar Coporation (NYSE:VAL), but investors may still be concerned about integration risks. In addition, the company’s financials for the second quarter of its fiscal year (the quarter ending in April) showed flat performance versus a year earlier.

A member of The Valspar Coporation (NYSE:VAL)’s Board of Directors, John Ballbach, seems to be more confident in management’s decisions. He directly acquired nearly 2,100 shares of stock on June 21st, nearly doubling his holdings to a total of about 4,800 shares. The purchases took place at an average price of $65 per share, above where The Valspar Coporation (NYSE:VAL) currently trades. We track insider purchases because our analysis of insider activity shows that there is a small outperformance effect for stocks bought by insiders (read our analysis of studies on insider trading); our theoretical explanation for this is that insiders should prefer to diversify their wealth unless they are confident that the company’s stock is undervalued.

The Valspar Corporation (NYSE:VAL)As we’ve mentioned, there was little change in The Valspar Coporation (NYSE:VAL)’s revenue or earnings in its most recent quarter compared to the same period in the previous year, and the same had been the case for fiscal Q1. Over this time a decline in the coatings business has been offset by growth in paints, which might be attributed to a rise in the U.S. housing market- a majority of the company’s total revenue is domestic. Wall Street analysts expect EPS to improve considerably this year and next year, and the stock trades at 14 times forward earnings estimates.

In addition to insider activity, we also monitor quarterly 13F filings from hundreds of hedge funds and other notable investors. We’ve found that 13Fs can be useful sources of information for developing investment strategies; we have found, for example, that the most popular small cap stocks among hedge funds generate an average excess return of 18 percentage points per year. We can also use this database to track interest in individual stocks, and can see that billionaire Ken Griffin’s Citadel Investment Group owned a little over 1 million shares of The Valspar Coporation (NYSE:VAL) as of the end of March (see Griffin’s stock picks).

Page 1 of 2
blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months. Our beta is only 1.2 (don't click this link if beating the market isn't important to you).

Lists

The 10 Best Countries To Work In the World

A Profitable Day At The Track: 5 Tips For Betting On Horses

Tearing You Apart: 6 Bad Habits That Ruin Relationships

Learning on the Job: The 6 Biggest Mistakes Parents Make

Shopaholics Rejoice: The 12 Biggest Malls in the World

Fright Night: 10 Horror Movies Based on True Stories

Mach Mania: The 10 Fastest Jets in the World

Military Heavyweights: The 10 Countries with the Most Tanks

All In: The 7 Richest Poker Players in the World

Abracadabra: The 10 Best Magicians in the World

The 10 Richest Asian Countries in the World in 2014

Eyes in the Sky: 10 Things You Need to Know About Drones

Rising Stars: The 6 Best Silicon Valley Startups

Military Muscle: The 5 Most Advanced Armies in South America

All that Glitters: The 7 Most Luxurious Jewelry Brands in the World

5 Things You Didn’t Know About ISIS but Should

Empowering Your Money: The 5 Best Energy Stocks to Invest In

The 11 Best Android Apps You Can’t Get on iOS

The 10 Most Important International Conflicts in 2014

Mood Enhancers: The 20 Most Uplifting Songs of all Time

Lover Beware: The 8 Countries that Cheat the Most

Breath of Fresh Air: The 25 Countries with the Best Air Quality on the Planet

Singles Beware: The 8 Worst Mistakes Made on First Dates

Healthy and Happy: The 10 Countries with Lowest Healthcare Costs

The 6 Best Company Team Building Activities to Build Workplace Camaraderie

Ships Ahoy: The 10 Busiest Shipping Ports in the World

10 Productivity Tips to Save You Time and Help You Do More With Less

Grab a Bite: The Most Popular Fast Food Restaurants in America

Friday Night Thirst: The 10 Most Popular Cocktails in the World

The 6 Greatest Unsolved Mysteries We May Never Figure Out

7 Useless Products You Never Should’ve Bought

The 5 Reasons Why You’re Single and Miserable

The 7 Most Addictive Foods in the World We Can’t Stop Eating (Even Though We Should)

5 Amazing Places You Can Swim with Dolphins

The Top 7 Most Livable Countries In The World

The 10 Most Expensive Baseball Cards Ever Pulled From A Pack

The 5 Easiest Second Languages to Learn for English Speakers

Silver Spoon: The 6 Richest Families in the World

The 20 Countries with the Largest Prison Populations in the World

The Top 10 Richest Actors in the World

The 10 Best Airline Stocks to Invest In Before They Fly Too High

Burger Kings: The 10 Most Expensive Burgers in the World

The 10 Most Ethnically Diverse Countries in the World

The 10 Most Exclusive Credit Cards in the World

The 10 Most Expensive Cruise Ships in the World

The 10 Fastest Supercomputers in the World

The 10 Best Countries for Doing Business 2015

6 Most Expensive Fruits In The World

10 Worst Airlines in the World

The 10 Biggest Tax Havens in the World to Stash Your Money

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!