Unusual Insider Buying at These 3 Companies; Wal-Mart Stores Inc. (WMT) And HP Inc. (HPQ) Among Them

Page 2 of 2

Wal-Mart Stores Inc. (NYSE:WMT) had not seen any insiders buy stock in more than five years until last week. Director Timothy Patrick Flynn snapped up 10,000 shares on Wednesday at a price of $58.46 per share and currently holds an ownership stake of 25,374 shares. The world’s largest retailer has seen its shares decline 30% this year, which are trading at an appealing trailing P/E ratio of 12.69. The retailer’s financial performance in 2015 has been impacted by an increase in wage expenses at its Walmart U.S. segment as a result of the new associate wage structure, and sustained investments in digital retail and information technology. In fact, the operating expenses as a percentage of net sales increased 69 basis points for the nine-month period that ended October 31. Additionally, the company increased its operational investments in e-commerce in an attempt to fight the fast-increasing competition in the low-cost, online retail industry and also decreased its in-store pricing to boost up traffic, which also put some weight on Wal-Mart’s financials. Despite the short-term margin pressures, the stock seems to represent a great buying opportunity at the moment if looking at the company’s brand image, strong cash flow and attractive valuation metrics. Warren Buffett’s Berkshire Hathaway was the largest shareholder of Wal-Mart Stores Inc. (NYSE:WMT) among the 61 hedge funds (from our database of 737 hedge funds) with positions in the company at the end of the third quarter, owning 56.19 million shares.

Follow Walmart Inc. (NYSE:WMT)

Lastly, we will investigate the insider buying activity at Norwegian Cruise Line Holdings Ltd (NASDAQ:NCLH), which had not witnessed insider buys for several years until last week. Director Chad A. Leat acquired a new stake of 5,000 shares last Wednesday at a weighted average price of $58.30. The shares of the cruise line operator are up 24% this year and can go even higher should analysts’ earnings expectations for the next year be accurate. The company’s third-quarter total revenues added up to $1.3 billion, compared with $0.9 billion reported in the same quarter a year ago. The increase in passenger ticket pricing, higher on-board revenue, and increased capacity days (due to the acquisition of Prestige) stand behind the 40.4% increase in revenue. Its GAAP diluted earnings per share came to $1.09 for the quarter, up from EPS of $0.97 reported last year. However, some investors may have started to worry about an increased threat of terrorism all around the world, which could hinder Norwegian Cruise Line from delivering the much-awaited earnings growth next year. The smart money sentiment towards the stock did not change during the third quarter, with 38 hedge funds tracked by Insider Monkey being invested in the company on September 30. John Armitage’s Egerton Capital Limited acquired a 2.07 million-share stake in Norwegian Cruise Line Holdings Ltd (NASDAQ:NCLH) during the September quarter.

Follow Norwegian Cruise Line Holdings Ltd. (NASDAQ:NCLH)

Disclosure: None

Page 2 of 2