Insiders Have Bought Winnebago Industries, Inc. (WGO), The Wet Seal, Inc. (WTSL), and More

Page 1 of 2

Economic theory, through the principle of diversification, suggests that it is irrational for company insiders to buy shares of the company and therefore increase their company-specific risk unless they are particularly confident in the stock’s prospects. Of course, sometimes insiders are wrong (or potentially buy the stock for other reasons), but overall stocks bought by insiders narrowly outperform the market (read our analysis of studies on insider trading). This is why we track insider purchases as well as maintain our database of hedge fund filings which we use to research investing strategies (including our top small cap picks among hedge funds strategy). Read on for five stocks which insiders have been buying recently.

Chuck Royce

A member of Winnebago Industries, Inc. (NYSE:WGO)’s Board of Directors purchased 4,000 shares of stock in mid April at prices generally between $17.50 and $18 per share. Winnebago Industries, Inc. (NYSE:WGO)’s revenue grew by 35% in its most recent fiscal quarter compared to the same period in the previous fiscal year, and the company earned $6.3 million in net income as opposed to a net loss. The stock is up 93% in the last year, and currently trades at 14 times forward earnings estimates. Chuck Royce’s Royce & Associates owned 2.2 million shares of Winnebago Industries, Inc. (NYSE:WGO) at the end of December (research more stocks Royce owns).

A Form 4 filed with the SEC showed a The Wet Seal, Inc. (NASDAQ:WTSL) Board member buying a little over 60,000 shares at an average price of $3.19 per share. The women’s and girl’s apparel retailer has been reporting declining same-store sales, and actually experienced an operating loss in the last fiscal year. The sell-side is not particularly optimistic, with Wet Seal, Inc. (NASDAQ:WTSL) expected to post negative earnings per share this year as well. When we looked at the company, we didn’t think that it looked like a good buy, and that value investors might be better served by considering peers such as Jones Group (NYSE:JNY) or Ann Inc (NYSE:ANN).

One of AGCO (NYSE:AGCO)’s company officers bought close to 4,000 shares of stock on April 16th. For a couple months a company related to a Board member has been buying shares, so we now have multiple insiders buying AGCO; consensus insider purchases are stronger, though not perfect, bullish signals. As with many agriculture related companies, AGCO posts fairly low earnings multiples- the trailing and forward P/Es are 9 and 8, respectively. Revenue has been up, though in Q4 net income was down by quite a bit versus a year earlier and we’d have to look into that before considering it as a value stock.

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 Best B-Boy Movies

Most Awesome Hip Hop Documentaries

Foods That Stain Your Teeth

Richest Doctors in the World

The Best Movie Sountracks Ever

The Highest Grossing Musicals on Broadway

The Most Successful Reality TV Stars

Cheapest Cities to Visit in the US

Most Expensive Summer Camps

Most Expensive Animals in the World

Most Expensive Specialty Crops in the World

Movies That Took Ages to Make

The Longest Hollywood Films Ever Made

Most Expensive Concert Stages

The Richest Bands of all Time

10 Most Corrupt Countries 2013 List

10 Countries with the Highest Quality of Life Index

Most Expensive Mattresses in the World

5 Smallest Countries by Land Area

The Ultimate Heartbreak Songs

Richest Teenagers in the World

10 Most Haunted Places in America

10 Best Places to Retire in Florida East Coast

Top 10 Places to See Before You Die

Top 8 Countries in the World Where Justice Prevails

10 Richest States in America

15 Wealthiest Countries in the World

Richest Singers in the World

Most Expensive Tasting Menu in New York City

Most Expensive Baby Items in the World

Most Expensive Hotel Suites in Vegas

Most Expensive Brunch in New York City

Most Expensive Beef Cuts in the World

25 Best Colleges to Get a Job

Top 10 US Supermarkets

The 25 Most Dangerous Cities in the World to Visit

Most Expensive Xbox Games

Top 11 Cities Where Billionaires Live

Top 10 Most Charitable Companies in America

Most Expensive Seafood in the World

The 10 Wildest Conspiracy Theories

The 10 Best Job Markets in the US

Top 10 Accounting Scandals of All Time

The 25 Biggest Cities in the World

Top 10 Best Paying Virtual Jobs

Most Expensive Leather Shoes in the World

Top 6 Things to Buy in March

The 10 Most Stressful Jobs in America – 2014 List

Top 10 Jobs for Introverted People

Top 10 Honeymoon Destinations in the World

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!