Two Small-Cap Consumer Cyclical Stocks That Insiders Are Buying

Tracking hedge fund and insider transactions is crucial to our investment strategy. Our research has shown that the 15 most popular small-cap stocks among hedge funds historically have outperformed the overall market (see the details). In addition, recent studies on insider trading have shown that investors can outperform the market by 7 percentage points by following certain insider purchases.
In this article I will look into two small-cap companies in the Cyclical Consumer Goods & Services sector that have witnessed insider purchases over the past few weeks, despite the fact that they both trade above their industry average valuations.

Natural Grocers by Vitamin Cottage Inc (NYSE:NGVC) is a $543 million market cap specialty retailer of natural and organic groceries and dietary supplements that has been delivering average revenue growth above 23% over the past five years (compared to an industry mean of 1%-2%). This kind of growth has led to one of the highest valuations in the grocery stores industry: the stock trades at 42.4 times the company´s earnings, well above the 11.2x P/E industry mean.­ Nonetheless, four insiders bought the company´s stock over the past few days.

Natural Grocers by Vitamin Cottage Inc (NYSE:NGVC)

On May 6, Kemper Isely, Chairman and Co-President, purchased 10,000 shares of Common Stock for an average price of $23.93 per share, and now owns 3,107,402 shares of the company. On that same date, Richard Halle, Board Director, acquired 4,000 shares of the company; 2,000 of them for $23.78 per share, and another 2,000, for $23.96 per share. Mr. Halle now holds 10,064 shares of Natural Grocers.

The following day, Edward Cerkovnik, Board Director, started a position in the stock with 3,500 shares, for which he paid prices ranging from $22.63 per share to $22.73 per share. In addition, Elizabeth Isely, Executive Vice President and 13D Group Member, bought 10,000 shares of Common Stock, for prices ranging from $22.54 to $22.74 per share, inclusive, and now owns around 1.26 million shares. Other investors worth mentioning are Donald Chiboucis, Richard Driehaus and Israel Englander, all of which hold millionaire stakes in the company.

The second company in this list is Superior Industries International Inc. (NYSE:SUP), a $531 million market cap designer and manufacturer of aluminum road wheels, which are sold to original equipment manufacturers (automobile and light truck manufacturers). Despite its razor thin margins and returns, and an above average valuation, Donald Stebbins, President and CEO, acquired 12,500 shares of Common Stock on May 7. He paid $19.40 per share and now owns 145,000 shares of the company. In addition, several prominent investors are also betting on this company. Amongst them we can count Mario Gabelli, with 2.30 million shares, and Chuck Royce, with approximately 495,000 shares.

Disclosure: Javier Hasse holds no position in any stocks mentioned

Recommended Reading:

ValueAct Capital Buys More Than $116 Million in Microsoft (MSFT) Shares

AOL, Inc. (AOL), F.N.B. Corp (FNB): Mid-Cap Stocks That Insiders Like

Two Oil & Gas Stocks With Multiple Insider Purchases

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

The Top 10 States With Fastest Internet Speeds

10 Best Places to Visit in USA in August

Top 10 Cities to Visit Before You Die

Top 10 Genetically Modified Food In the US

15 Highest Grossing Movies Opening Weekend

5 Best Poker Books For Beginners

10 Strategies Hedge Funds Use to Make Huge Returns

Top 10 Fast Food Franchises to Buy

10 Best Places to Visit in Canada

Best Summer Jobs for Teachers

10 Youngest Hedge Fund Billionaires

Top 10 One Hit Wonders of the 90s

Fastest Growing Cities In America

Top 10 U.S. Cities for Freelancers

Top 9 Most Popular Free iPhone Apps

Top 10 Least Expensive Private Business Schools in the US

Top 15 Most Expensive Countries in the World – 2014

Top Businesses to Invest In

Top 5 Things You Might Be Doing Wrong With Your Business

Top 5 Strategic Technology Trends in 2014

Top Rags to Riches Stories

Parenting Behavior That Promotes Future Leaders

Top 5 Mistakes Made by Small Businesses

Top 5 Most Common and Potentially Devastating Financial Blunders

Top 5 Highest Paying Jobs for Web Designers

Top 6 Most Respected Professions that Also Pay Well

Top 5 Pitfalls Investors Should Avoid

Top 6 Lawyers and Policy Makers Under 30

Top 6 New Year’s Resolutions for Entrepreneurs

Top 7 Locations to Check in on Facebook

Top 5 Mistakes made by Rookie eBay Sellers

Top 7 eBook Publishers in 2013

Top 6 Health Industry Trends in 2014

5 Lessons for Entrepreneurs from Seth Godin

Top 5 Success Tips from Jordan Belfort – the Wolf of Wall Street

Best Master’s in Finance Degree Programs

Top 6 Earning Celebrities Over 50

The most expensive sports to play

Top 7 Earning Celebrities Under 25

Best 7 Online Courses to Take: Free Finance MOOCs

Top 6 Bad Habits that Promote Failure

20 Most Valuable Soccer Teams in the World in 2013

12 Most Expensive Countries for Foreign Students

Top 30 Most Influential Women in the World

Top 20 Most Expensive New Year Eve Shows

Top 5 Best Vocational Careers

Top 10 Jobs for 2014 by Salary Gain (Predictions)

Top 5 Digital Trends for 2014

Top 6 Things You Can Do To Increase Your Productivity

Top 9 Trending Smartphones in 2013

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!