September has seen a huge uptick in terms of insider buying activity, with the five most active days for insider purchasing this year all having fallen within the past two weeks. With trade war fears putting a damper on the shares of numerous large companies with international operations, smaller U.S-focused businesses are picking up the slack.
Among companies in the Russell 1000, those in the second and third quintile have outperformed those in the first quintile (the largest 20% of companies), with gains of 13% and 12% respectively, compared to 8.7%. Likewise, the Russell 2000 index has outperformed the S&P 500 in 2018 by a similar tally of 12% to 8.7%.
Below, we’ll check out last week’s insider buying activity in FGL Holdings (NYSE:FG), Rigel Pharmaceuticals, Inc. (NASDAQ:RIGL), and Kemper Corporation (NYSE:KMPR), and look into why insiders are likely feeling optimistic about these stocks.
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FGL Holdings (NYSE:FG)
Who Bought Shares: Director Richard Massey and CFO Dennis Vigneau
How Many Shares Were Bought: 50,000 @ $8.76 per share and 25,000 @ $8.75 per share respectively
Date of the Transaction(s): September 11-13
The two insiders of FGL Holdings (NYSE:FG) made the first ever insider purchases of the company’s shares within days of each other. Director Richard Massey now owns 62,488 shares after his recent purchase of 50,000 shares, while FGL CFO Dennis Vigneau has direct ownership of 25,000 shares, all of which were purchased on September 13.
FGL Holdings (NYSE:FG) was created through the November 2017 merger of CF Corporation and Fidelity and Guaranty Life. The company is still going through a transition period following that merger. The provider of life insurance products and annuities plans to expand its portfolio of product offerings and distribution, which are still relatively narrow. FGL is also focused on improvements to its portfolio, including a shift from corporate to structured securities.
On the next page we’ll look at two other stocks with heavy insider buying activity last week.
Rigel Pharmaceuticals, Inc. (NASDAQ:RIGL)
Who Bought Shares: EVP & Chief Commercial Officer Eldon C. Mayer III
How Many Shares Were Bought: 100,000 @ $3.26 per share
Date of the Transaction(s): September 10-11
Rigel Pharmaceuticals, Inc. (NASDAQ:RIGL)’s EVP and Chief Commercial Officer purchased over $325,000 worth of shares at the beginning of last week, nearly doubling his direct ownership to 215,000 shares. At the beginning of last September we identified Rigel as a penny stock that was poised to explode. Within a month, the stock had gained 50% in value and climbed even higher throughout October. It hasn’t been able to sustain those gains in 2018 however, declining by 20% this year.
Rigel Pharmaceuticals, Inc. (NASDAQ:RIGL) is rapidly transitioning from a developmental-stage company into a commercial one following the April FDA approval and May commercialization of Tavalisse, which is forecast to achieve peak sales of $350 million annually for its current approved indications. Rigel is working towards approval in other indications as well, namely for treating autoimmune hemolytic anemia. Rigel will file for European approval for Tavalisse by the end of the year.
Kemper Corporation (NYSE:KMPR)
Who Bought Shares: Director George Cochran
How Many Shares Were Bought: 500 @ $83.55 per share
Date of the Transaction(s): September 12
Kemper Corporation (NYSE:KMPR) director George Cochran, the former Chairman of the Global Financial Institutions Group at Macquarie Capital, owns a total of 10,218.05 shares of the company after his recent insider purchase. Since Mr. Cochran’s first insider purchase of Kemper shares last March, the stock has more than doubled in value.
Kemper Corporation (NYSE:KMPR) shares briefly pulled back to just over $70 in July after selling pressure from Infinity Property shareholders, who were given Kemper shares as part of the merger between the two companies, which was completed ahead of schedule. Kemper’s shares have since recovered to push to all-time highs. The insurance company blew away Q2 revenue estimates at the end of July when it reported $741.9 million in quarterly revenue, topping estimates by more than $110 million.