Clusters of Insider Buying at Synergy Resources Corp (SYRG), EVINE Live Inc. (EVLV); Three Other Stocks With Significant Insider Trading

Heavy insider buying is usually interpreted as a bullish signal by the investment community because there appears to be only one reason corporate insiders are buying shares in their own companies. Unlike many indicators based on historical data, insider buying usually serves as a forward-looking indicator. Most of the time, insider purchases show that corporate insiders believe their company’s stock is worth much more than the price tag set by the invisible hand of Mr. Market and they tend to be very accurate on most occasions.

Past research, analysts and insider trading experts suggest that clusters of insider buying are significantly more informative than single buys. Hence, a herd of insiders buying shares is a much better signal than a “lone wolf” who may be wrong. As Dr. Inan Dogan, the founder of Insider Monkey and a well-known researcher in the field of insider trading, said in an interview held in the not-so-distant past: “One insider might overestimate a company’s prospects, but there is higher uncertainty when many insiders are buying.” With that in mind, the following article will reveal clusters of insider buying recently observed at several companies, as well as discuss other notable insider transactions reported with the SEC on Thursday.

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CEO of Industrial Distributor Buys Shares Amid Price Weakness

To start with, the man in charge of HD Supply Holdings Inc. (NASDAQ:HDS) increased his holding of company stock this week. Joseph J. DeAngelo, Chairman, President and CEO, snatched up 32,100 shares on Thursday at a price tag of $31.07 each. Following the recent purchase, Mr. DeAngelo currently owns 242,782 shares of HD Supply.

The industrial distributor in North America has seen the value of its shares advance by 3% since the beginning of the year despite experiencing a 14% plunge in the past month. The aforementioned insider purchase comes shortly after analysts at RBC Capital Markets downgraded HD Supply Holdings Inc. (NASDAQ:HDS) to ‘Sector Perform’ from ‘Outperform’ and cut their price target to $35 from $43. RBC analysts anticipate the industrial distributor’s shares to range-bound in the upcoming months as the company attempts to “right the ship.” According to RBC, HD Supply needs several quarters to tackle supply chain problems and restore investor confidence. John Griffin’s Blue Ridge Capital was the owner of 8.29 million shares of HD Supply Holdings Inc. (NASDAQ:HDS) at the end of the June quarter.

The next page of this article will discuss clusters of insider buying registered at two separate companies.

Cluster of Insider Buying at Independent Oil and Natural Gas Company

Three different corporate insiders at Synergy Resources Corp (NYSEMKT:SYRG) purchased shares this week. To begin with, Michael J. Eberhard, Chief Operating Officer of Operations, bought 15,000 shares on Tuesday at a weighted average cost of $6.11 per share, a purchase that boosted his ownership to 93,763 shares. General Counsel Cathleen M. Osborn disclosed on Thursday the purchase of 2,000 shares at a cost of $6.01 per share, which lifted her holding to 81,300 shares. Last but not least, James P. Henderson, Chief Financial Officer and Executive Vice President of Finance, snapped up 50,000 units of common stock on Tuesday at prices varying from $5.93 to $5.98 per unit. After the recent purchase, Mr. Henderson currently holds an ownership stake of 179,605 shares.

The growth-oriented independent oil and natural gas company has seen its market capitalization plunge by 21% since the start of the year. Synergy Resources Corp (NYSEMKT:SYRG)’s drilling and completion activities are focused in the Wattenberg Field, an area covering the western flank of the liquids-rich D-J Basin. In early August, analysts at BMO Capital Markets downgraded Synergy Resources to ‘Market Perform’ from ‘Outperform’ and trimmed their price target to $6 from $8, saying that they “expect the company to emphasize liquidity preservation over drilling activity increases” due to weakening commodity prices. Dmitry Balyasny’s Balyasny Asset Management acquired a new stake of 2.78 million shares of Synergy Resources Corp (NYSEMKT:SYRG) during the April-to-June quarter.

Cluster of Insider Buying at Beleaguered Clinical-Stage Vaccine Company

Soon after a member of Novavax Inc. (NASDAQ:NVAX)’s boardroom purchased a sizeable stake of shares earlier this week, three other corporate insiders stepped up and bought shares as well. Board member Richard Douglas bought 100,000 shares on Wednesday at prices ranging from $1.71 to $1.73 per share, boosting his overall holding to 350,000 shares. Michael A. McManus Jr., yet another member of the company’s boardroom, acquired 30,000 shares on the same day for $1.61 each, an acquisition that lifted his ownership to 247,590 shares.  Gregory M. Glenn, President of Research and Development, acquired 1,000 shares at $1.65 apiece, increasing his stake to 3,427 shares.

Given that this massive cluster of insider buying comes after the clinical-stage vaccine company reveled disappointing results from a late-stage clinical trial for a vaccine for a respiratory virus known as RSV-F, the recent spike in insider buying shows insiders’ confidence in the future prospects of its lead product candidate. Novavax Inc. (NASDAQ:NVAX)’s shares plunged by around 80% on the release of dismal trial data, but the stock has gained 45% in the past five trading days. The company plans to release a more detailed analysis at its investor meeting that is set to take place on October 11, where investors might get a clear understanding of the company’s next steps for developing an RSV vaccine. Baker Bros. Advisors, founded by Julian and Felix Baker, owns 2.38 million shares of Novavax Inc. (NASDAQ:NVAX) as of the end of the second quarter.

The final page of this article will discuss several other notable insider transactions reported with the SEC on Thursday.

Two Board Members at EVINE Live Buy Shares

Two corporate insiders at EVINE Live Inc. (NASDAQ:EVLV) purchased shares this week, a mini-cluster of insider buying that might be worthy the attention of the investment community. Board member Fred R. Siegel purchased 8,969 shares on Tuesday at an average price of $2.22 per share, lifting his ownership to 70,396 shares. Landel C. Hobbs, another member of the company’s Board of Directors, snapped up 45,000 shares on Monday at a weighted average purchase price of $2.21 per share. After the recent transactions, Mr. Hobbs currently owns 132,575 shares.

The Insider Monkey team discussed the insider purchases of six different insiders of EVINE Live Inc. (NASDAQ:EVLV) at the end of March, as well as discussed additional insider purchases of several other insiders at the beginning of April. Interestingly enough, the shares of EVINE Live are up a whopping 185% in the past six months (since late March), so insiders are really good at employing the so-called bottom-fishing strategy indeed. EVINE Live is a digital commerce company that operates a 24-hour television shopping network through which the company offers and sells proprietary, exclusive and name brand products in a number of categories. The company’s net sales for the six months that ended July 30 were $324.1 million, up from $319.5 million posted for the same period of the prior year. Jeffrey Bronchick’s Cove Street Capital reported ownership of 6.59 million shares of EVINE Live Inc. (NASDAQ:EVLV) in its 13F for the second quarter.

Founder of Leading Ethanol Company Unloads Shares

The founder of REX American Resources Corp (NYSE:REX) offloaded a relatively sizeable chunk of shares this week. Stuart Rose, Executive Chairman of the company’s Board and former CEO, discarded 13,562 shares on Wednesday at prices that fell between $84.00 and $84.32 per share. Mr. Rose currently owns 631,160 shares.

The ethanol company has seen its market value jump by 56% since early January, which somewhat explains Mr. Rose’s decision to liquidate some shares. REX American Resources Corp (NYSE:REX)’s net sales and revenues for the quarter that ended July 31 were $115.7 million, up from $113.5 million posted in the same period of the prior year. Ethanol sales increased to $90.9 million from $87.0 million posted a year ago, reflecting an increase of three million gallons sold. There were six hedge funds followed by Insider Monkey with long positions in the leading ethanol company at the end of June, amassing around 11% of the company’s common stock. Jim Simons’ Renaissance Technologies LLC owns 526,400 shares of REX American Resources Corp (NYSE:REX) as of June 30.

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