At Insider Monkey, we track the moves of both company insiders and a select group of hedge funds to identify collective buying and selling patterns, so we can profit from their knowledge and expertise. In the case of our hedge fund tracking, we also use that data to power our small-cap strategy, which has returned over 123% since its inception in September 2012, crushing the S&P by more than 65 percentage points during that time (that’s nearly double the returns!) (see the details).
As mentioned, we also track the latest moves by company insiders, paying particular attention to insider purchases. Though the correlations aren’t as strong as they are with hedge fund activity, we can still gain some valuable insight into stocks based on the activity of insiders in those companies. We’ve identified three companies with notable insider sales on August 11, and will take a look under their hoods in this article. The companies are World Wrestling Entertainment, Inc. (NYSE:WWE), Gentherm Inc (NASDAQ:THRM), and Omnicell, Inc. (NASDAQ:OMCL).
We’ll start with World Wrestling Entertainment, Inc. (NYSE:WWE), whose Chief Brand Officer Stephanie Levesque, better known by her maiden name Stephanie McMahon, has sold off over 105,000 shares this week of the company her father Vince and mother Linda founded in 1980. The sales by Stephanie, a former WWF (as it was known at the time) Women’s Champion, who remains an entertainment personality for the company’s wrestling programming, are the first by her since early 2014. Basil Devito, the company’s Senior Advisor of Business Strategies has also sold 4,100 shares this week. It’s not surprising to see insiders selling, as WWE has had a strong year on the stock market, gaining over 68% year-to-date. While shares are still down by about 50% from their early 2014 high around the time the company launched its home streaming service WWE Network, the market seems to finally be warming up to the service after the disappointment of missed subscriber targets.
We reported in early July that Wells Fargo initiated coverage on WWE with an ‘Outperform’ rating and $22 to $24 price target range, with the investment firm citing the WWE Network as being under-appreciated by the market. Since then, WWE has soared to nearly $21, gaining over 33%. Hedge funds have liked what they see in the company and its growth potential, with the number of hedge funds invested in the stock and the value of their holdings both increasing by 27% during the first quarter. Of the funds that have reported their June 30 positions, Mario Gabelli’s GAMCO Investors holds the largest stake in World Wrestling Entertainment, Inc. (NYSE:WWE) among the funds we track, with 358,400 shares held between Gabelli Funds and GAMCO Investors.
