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

Biotech Insider Alert - $6 Stock To Hit $40

$200 Million Dollar Healthcare Hedge Fund's #1 Best Idea Right Now

The best healthcare hedge fund out there right now is one of the largest shareholders in this biotech stock. The fund returned more than 20% in each of the last 2 years with a virtually fully hedged portfolio, and it's sending out a BUY signal on this biotech stock. Get your FREE REPORT today (retail value of $300)

This is a FREE report from Insider Monkey. Credit Card is NOT required.
Click here to Read Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 74 percentage points in 2.5 years. Our beta is only 1.2 (download a FREE newsletter and see the details inside)

Lists

Best Selling Magazines in the World

Shortest People in History

The Most Celebrated Holidays in the World

Most Expensive Handbag Brands in the World

Top Selling Comic Book Issues of this Century

The Most Powerful Women in Politics

Best Paid DJs

Most Rebellious Female Artists

Best Paid TV Actresses of 2014

Best Paid Actors of 2014

Most Expensive Horses in the World

Tallest People Ever

Most Encouraging Feminist Celebrities

Best Paid Supermodels of 2014

Top 10 Suburbs for Retirement in 2015

10 Wealthiest Cities in America

Top 10 TED Talks for Entrepreneurs

Best TED Talks on Education

25 Most Dangerous Places to Live in America

Top 10 Ski Resorts in the United States – 2014 List

Top 10 Most Remote Places in the World

Most Visited Museums in the United States

Wealthiest Photographers in the World

Most Famous Gay Athletes

The World’s Most Famous Circuses

Best Hair Stylists

Most Popular NASCAR Drivers

The Best Romance Movies of all Time

The Most Wanted Drug Lords

The Oldest Money Managers

The Greatest Directors in the World

Largest Animals in the World

World’s Most Expensive Desserts

Best Selling Comic Books of All Time

A-list Actors who Sabotaged Their Career

Rappers With a College Degree

The Best Jazz Albums of all Time

The Most Influential Jazz Musicians

The World’s Most Famous Photographers

The Best Oscar-Winning Songs

Most Influential Choreographers Ever

Most Expensive Department Stores in the World

The Most Expensive Stolen Paintings in the World

The World’s Most Expensive Teas

Top Oscar Record Holders

The Most Expensive Flowers in the World

Countries With a Booming Film Industry

Most Expensive Cupcakes in the World

Uncommon European Escapes

The Most Stolen Artists in History

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 129% in 2.5 years!! Wondering How?

Download a complete edition of our newsletter for free!