President of Large Small-Cap, Closed-End Fund Buys Shares at Discount
One member of Royce Value Trust Inc. (NYSE:RVT)’s management team purchased a few shares last week. President Christopher D. Clark bought 1,500 shares on Friday at a price tag of $13.88 each. Mr. Clark owns 3,540 shares after the Friday purchase.
Royce Value Trust Inc. (NYSE:RVT) operates as a closed-end diversified management investment company that seeks to invest at least 65% of its assets in equity securities, primarily those of small-cap and micro-cap companies. As a closed-end fund’s share price is set by supply and demand forces, the value of closed-end shares can deviate from their net asset value quite significantly on certain occasions. For instance, the largest small-cap closed-end fund recorded net assets per share of $15.84 as of December 31, whereas the market share price of the fund stood at only $13.39. This essentially means that investors could have bought $15,840 of assets by paying only $13,390. More importantly, past research concludes that closed-end funds trading at a discount tend to outperform the market and insiders seem to attempt to capitalize on that. Murray Stahl’s Horizon Asset Management owned approximately 111,000 shares of Royce Value Trust Inc. (NYSE:RVT) at the end of September.
Executive at Battered Life Sciences Company Purchases Shares After Dividend Cut, Reduced Guidance
An executive at Meridian Bioscience Inc. (NASDAQ:VIVO) also piled up some shares this past week. Lawrence J. Baldini, President of Global Operations and Executive Vice President, snatched up 4,000 shares on Thursday at a price of $12.70 per share. Mr. Baldini currently owns a total of 106,934 shares after the recent purchase.
The fully-integrated life sciences company has seen the value of its shares decline by 31% in the past year, mainly due to a serious plunge experienced several days ago when the company announced a significant dividend cut and released a disappointing first-quarter earnings report. Meridian Bioscience Inc. (NASDAQ:VIVO)’s Board of Directors reduced the company’s annual dividend payout from $0.80 per share to a mere $0.50 per share. The management of the diagnostics-focused life sciences company also reduced its revenue and earnings forecast for its 2017 fiscal year, citing revenue decreases in Meridian’s Americas diagnostic company (i.e. the company’s largest profit driver) “due to customer buying patterns and general weakness overall.” Joel Greenblatt’s Gotham Asset Management added a 247,000-share stake in Bioscience Inc. (NASDAQ:VIVO) to its pool of holdings during the third quarter.
The final page of this article will discuss fresh insider selling observed at two companies.