Insiders Have Bought American International Group Inc (AIG) and More of Billionaire Dan Loeb’s Picks

Page 1 of 2

Studies show that stocks bought by insiders tend to narrowly outperform the market (read our analysis of studies on insider trading) which we’d attribute to insiders tending to buy when they are confident in the company’s prospects; at other times, it makes more sense for them to diversify away from the company. We also track quarterly 13F filings from hedge funds as part of our work researching investment strategies (we have found, for example, that the most popular small cap stocks among hedge funds earn an average excess return of 18 percentage points per year). It’s also possible to go through filings from individual managers such as billionaire Dan Loeb of Third Point and look for stocks which company insiders have bought recently as a potential source for investment ideas. Here is our quick take on Third Point’s five largest holdings as of the end of March which at least one insider has bought in the last three months (or see the full list of the fund’s stock picks).

While Loeb sold some of his shares of American International Group Inc (NYSE:AIG), it was still one of his three largest holdings by market value. Our database shows that one of the company’s Board members bought 10,000 shares in May at an average price of $45.20 per share. While American International Group Inc (NYSE:AIG) has done well year to date, we think that is still maintains some value prospects given its discount to the book value of its equity (the P/B ratio is 0.8). The company’s reputation is still poor enough that we wouldn’t expect it to trade at book, but we’d still expect this gap to narrow a bit over time. American International Group Inc (NYSE:AIG) had been the most popular stock among hedge funds in the fourth quarter of 2012, but fell to #3 last quarter (find more of hedge funds’ favorite stocks).

Dan Loeb Third PointAn insider was buying shares of Murphy Oil Corporation (NYSE:MUR) in May; Third Point’s most recent 13F revealed a position of 2.5 million shares. Murphy Oil Corporation (NYSE:MUR) is a $12 billion market gap oil and gas company, which Loeb is pushing to split its upstream and downstream operation. Spinouts can be potential sources of value creation, as management of the new company can better focus on operations without having to worry about the needs of the larger organization. Learn more about investing in spinouts. As it currently stands, Murphy Oil Corporation (NYSE:MUR) trades at 12 times trailing earnings so it does not require much in improved efficiencies to make it a good value at the current price.

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 Click to see monthly returns in table format!

Lists

10 High Margin Food Products to Build a Business Around

The 10 Most Expensive Clothing Stores in the United States to Get Decked Out At

The 5 Biggest Kickstarter Scams That Swindled Backers’ Donations

The 10 Most Expensive Boarding Schools In the World

50 Crazy Facts About Japan You Won’t Believe

Top 10 Least Expensive Hybrid Cars to Save the Planet With

The 10 Biggest ‘Gate’ Controversies in History

The 10 States with the Highest Nursing Shortages Leaving Their Hospitals Depleted

The 10 Best Value Investment Blogs that Every Investor Must Read

The 6 Cheapest Boarding Schools in Europe 2015

The 5 Most Expensive Cars To Insure in the World

The 10 Most Common Genetically Modified Foods

10 Self-Made Billionaires Who Came From Nothing

The 10 Most Expensive Cities to Live in North America

The 13 Most Expensive Headphones in the World to Represent

The Top 20 Wealthiest Soccer Teams in 2014

4 BuzzWorthy Cannabis Stocks And Some Smoking Derivative Plays

The 10 Healthiest Fast Food Chains in America to Dine At

The 5 Most Expensive Cat Food Brands You Can Spoil Your Kitty With

The 6 Best eCommerce Platforms for Small Businesses

The 10 Worst Mistakes an Entrepreneur Can Make

The 5 Most OP Characters in League of Legends to Carry Games and Crush Foes With

The 5 Best Foods to Eat Before Running that Will Help You Pound the Pavement

10 Glaring Plot Holes in The Walking Dead that a Zombie-Filled Bus Could Drive Through

The 5 Biggest Celebrity Stoners Who Love Their Reefer

The 10 Most Overrated Movies Of All Time by Out-of-Touch Critics

Top 6 Least Expensive Cruise Destinations For 2015 that Will Take You to Paradise

10 States with Lowest Substance Abuse Rates in America

The 14 Most Watched TV Finales Ever

The 10 Best Selling Role Playing Games of All Time for PC

10 Most Influential Papers In Economics

Top 8 Biggest Charities in the US

10 Worst Celebrity Career Moves Ever

Top 10 Best Paid Tennis Stars in the World

Top 6 Cities For The Ultra Rich to Live in Comfort

10 Cities with High Demand for Nurses

6 of the Worst Greeting Card Messages Ever Crafted

How to Make Money in ArcheAge and Build Your Empire

10 Foods To Eat To Lower Cholesterol Levels

The 10 Most Hated Television Characters of All Time

The 30 Worst Halloween Costume Ideas Ever Brought to Horrible Life

10 Vocational Skills in Demand Today with Jobs Waiting to be Filled

10 Best Places to Visit in Central and South America

The 10 Greatest Empires in History Which Nearly Conquered the World

The 6 Cheapest Boarding Schools In America 2015

5 Clear Reasons LoL is Better than DotA, Continues to Rule MOBAs

The Only 9 Teams with a Chance to Win the Super Bowl

The 15 Most Common Phobias in America that Induce Fits of Panic

Top 6 Least Expensive Tourist Destinations in 2014

Jim Goetz, Peter Fenton, Jim Breyer: Top 6 Venture Investors for 2014

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!