Insider trading sentiment is always an important indicator to track, especially when it is bullish. Earlier this week, one notable Apple Inc. (NASDAQ:AAPL) insider was buying, which is more activity than we’ve seen at Google Inc (NASDAQ:GOOG) or Microsoft Corporation (NASDAQ:MSFT) this quarter. Let’s get into the details, but it’s worth noting that our empirical research has proven that individual investors can beat the market by an average of 7% a year following insiders if they know where to look. Here’s our strategy.
In a Form 4 filing with the SEC on Monday, November 19th, Apple Director and CEO of The Walt Disney Company (NYSE:DIS) Robert A. Iger purchased 1,780 shares of the tech giant at a share price between $562.13 and $565.08. Altogether, Iger’s bullish move was worth just over $1 million worth of AAPL shares, increasing his holdings by 72.0%. With the trades completed – there were four in total – Iger now holds approximately $2.58 million worth of Apple’s stock.
Since the day of these transactions, shares of Apple have gained more than 6.5%, easily outpacing peers like Google (3.0%) and Microsoft (1.8%). Albeit this time frame is small, it does show the potential that bullish insider sentiment has on a company’s stock price, and there may be more room to run. We mentioned earlier today that some investment pros are recommending an options strategy for the next few weeks with a target price of $600 on AAPL, but it also may be a good time for a buy-and-hold approach.
At a forward earnings multiple below 10 and a sub-1.0 PEG, Apple Inc. (NASDAQ:AAPL)’s valuation is obviously attractive, and it is still the number one stock pick of the hedge fund industry. Here’s a look at just how many hedge funds love Apple, and here’s more of our coverage of the Cupertino-based tech company.