Insiders Bought Bank of America, TD Ameritrade, and More

Page 1 of 2

Investors cannot mimic every insider purchase, but they can use the knowledge that stocks bought by insiders tend to narrowly outperform the market on average (learn more about studies on insider trading) and think of insider purchases as being much like a stock screen. It’s similarly a bad idea to buy a stock because of a low earnings multiple or high insider ownership- these screens are best used to identify ideas for further research, and insider purchases can yield a list of stock ideas in the same way. Here are five stocks that insiders have been buying recently:

A Bank of America Corp (NYSE:BAC) Board member bought 20,000 shares at an average price of $11.53. The same insider had bought shares at about $9.50 in early November 2012. In the third quarter of 2012, Bank of America was one of the most popular stocks among hedge funds (see the full top ten list). Bank of America stands out among its peers for trading at a considerable discount to book value (the P/B ratio is 0.6) but in terms of earnings (the forward P/E is 9) it’s actually not particularly cheap. As a result, when Insider Monkey last looked at the stock we thought that some other banks made for better investments. Read more about the insider purchase and which large banks we like instead.

THIRD POINT

Health insurer UnitedHealth Group Inc. (NYSE:UNH) also had a member of its Board of Directors buy shares of the stock. UnitedHealth is up 25% from its levels a year ago, but is still a potential value stock with trailing and forward P/Es of 11 and 9 respectively. The company has been experiencing modest growth on both top and bottom lines, but earnings growth does not need to be high at its current pricing for the stock to prove undervalued. Billionaire Dan Loeb’s Third Point owned 2 million shares at the end of September (find Loeb’s favorite stocks). Investors should consider UnitedHealth and other health insurance stocks, as they tend to be cheap and tend to have low betas in case of a bear market.

Read on for our coverage of three more insider purchases, including one at TD Ameritrade:

Page 1 of 2
Comments
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 Largest Pharmaceutical Companies In the World

The 10 Most Expensive Android Apps

The 9 Most Expensive Designer Bags in the World

The 7 Most Expensive Real Estate in the World

The 10 Most Expensive eBay Items Ever Sold

The 10 Most Expensive iPhone Apps

The 9 Most Expensive Designer Shoes in the World

The 10 Most Expensive Cigarette Brands

The 10 Most Expensive Law Schools in the US

The 10 Best Wall Street Movies

The 10 Most Expensive Golf Clubs Ever Sold

The 10 Most Expensive Golf Memberships

The 10 Best Disney Characters Ever Created

The 8 Best Foods for Gaining Weight

The 10 Most Expensive Colleges in the World

The 7 Most Memorable Ad Campaigns of All Time

The 7 Most Expensive High Schools in the World

The 10 Electric Vehicles with the Longest Range

The 10 Cities with the Worst Drivers in the World

The 10 Most Expensive Dresses Ever Created

10 Islands to Visit Before You Die

10 Famous Celebrities Who Needed Rehab

The 15 Countries with the Largest Oil Reserves

The 10 Most Overused Excuses in the World

The 5 Best iOS Apps You Can’t Get on Android

5 Companies Damaged By Social Media Blunders

The 10 Most Legendary Blues Songs

The 10 Most Lawless Places in the World

4 Reasons China is a Threat to the US

The 17 Most Sugary Drinks in the World

The 10 Most Ruthless Rulers in History

The 10 Greatest Generals in History

Top 8 Travel Destinations for 2015

The 10 Safest Dog Breeds for Children

The 10 Most Stolen Vehicles in the US

The 7 Most Expensive Celebrity Weddings

The 10 Best LoL Teams in the World

Top 10 Worst Marketing Campaigns Ever Produced

Top 5 Diets that Help You Lose Weight

The 10 Best Ways to Stay Awake

7 Artists That Switched Musical Genres

The 10 Most Expensive Cities to Live in New Jersey

The 10 Best High Schools in New York

The 10 Countries With the Least Gender Inequality

The 6 Biggest Musician-Manager Feuds

The 10 Countries with the Cheapest Gas Prices

The 7 Most Theatrical Bands of All Time

The 8 Worst Band Breakups of All Time

The 10 Most Important South American Leaders

The 7 Most Successful Casting Show Winners

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!