At Insider Monkey, we track insider trading and hedge fund activity to uncover actionable patterns and profit from them. We encourage investors to pay close attention to relevant insider buying activity as part of their stock analysis process, as history has shown that such moves precede a window of market-beating returns for those stocks on average.
The most compelling insider buying activity over the past week-plus includes purchases by insiders of Signet Jewelers Ltd. (NYSE:SIG), AutoZone, Inc. (NYSE:AZO), and Tupperware Brands Corporation (NYSE:TUP). We’ll examine those moves below.
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AutoZone, Inc. (NYSE:AZO)
Who Bought Shares: Director Douglas Brooks
How Many Shares Were Bought: 162 @ $607.49 per share
Date of the Transaction(s): April 16
Following the director’s purchase of 162 of AutoZone, Inc. (NYSE:AZO)’s rather pricey shares, he now owns 1,904 of them total. Those shares have become a lot less pricey in 2018, sliding by over $140 per share, or 19%.
AutoZone, Inc. (NYSE:AZO)’s Execution Strong, but Industry Headwinds Persist: Those share declines mirrored broader weakness in the stocks of auto parts companies, which didn’t meet sales expectations in the first-quarter. AutoZone shares have been run over the most among those companies, despite the company outperforming peers Advance Auto Parts, Inc. (NYSE:AAP) and O’Reilly Automotive Inc (NASDAQ:ORLY) in same-store sales growth in its latest fiscal quarter. Of note is that JPMorgan analyst Christopher Horvers believes that AutoZone, Inc. (NYSE:AZO)’s comps rose significantly in the second-half of the quarter (4%-5%) compared to the first-half (flat), which will bode well should that trend persist in full over the coming quarters.
On the next page we’ll look at the insider buying activity at Signet Jewelers Ltd. (NYSE:SIG) and Tupperware Brands Corporation (NYSE:TUP).
Signet Jewelers Ltd. (NYSE:SIG)
Who Bought Shares: CEO Virginia Drosos
How Many Shares Were Bought: 8,980 @ $38.96 per share
Date of the Transaction(s): April 13 – 16
The share purchases by Signet Jewelers Ltd. (NYSE:SIG)’s CEO lifted her stake in the company to 120,832 shares. Since she took over the helm of the specialty jeweler last July, Signet’s shares have lost well over 30%. Drosos shook up Signet’s organizational structure earlier this year in an effort to improve accountability and create a clearer chain of command with the goal being to foster quicker innovation. The move lead to several veterans of the company being let go.
Signet Jewelers Ltd. (NYSE:SIG) Sees Opportunities in Bridal, Self-Purchasers: In an interview with JCK in January, Drosos cited bridal and female self-purchasers as being areas of growth potential for Signet. After a few years of declines in the number of engagements due to demographic trends, Drosos anticipates a return to growth on that front. Drosos believes that Signet can also increase sales to self-purchasers of jewelry through diversifying and broadening its offerings to them and improving the company’s marketing to that segment.
Tupperware Brands Corporation (NYSE:TUP)
Several insiders of Tupperware Brands Corporation (NYSE:TUP) have purchased shares in the past ten days, including executive vice president Lillian Garcia and directors Kriss Cloninger III and David Parker. All told, the three insiders purchased just over 10,000 shares of the company best known for producing food storage containers.
The purchases all came on the heels of Tupperware’s sharp slump on April 10, when shares slid by over 10%. The company’s updated first-quarter guidance was the culprit, as the projected 2% year-over-year decline in revenue was well off previous guidance, which had revenue rising by 1% on the low-end. Tupperware also slashed its earnings per share guidance by $0.14 to a range of $0.87-$0.92.
Challenges, Opportunities Lie Ahead for Tupperware Brands Corporation (NYSE:TUP): Tupperware is enduring operational challenges in Europe after closing a manufacturing facility in France, which has weighed heavily on results there. On the other hand, Tupperware has burgeoning opportunities in markets like China and India which should propel it back into growth in the future. The stock is made even more attractive by a 6.52% dividend yield, which, despite the sluggish results, is well supported by solid free cash flow, estimated to be in the $175 million range in 2018.