Hertz Global Holdings Inc. (HTZ) Registers Eye-Catching Insider Buying, Massive Insider Sale at Best Buy Co Inc. (BBY), Plus Three Other Companies with Notable Insider Trading Activity

U.S. equities finished the week on a negative note on Friday, as investors lowered meaningfully their expectations for a rate hike this summer after the release of a weaker-than-expected jobs report. The U.S. employers added 38,000 jobs last month, which represents the weakest performance in more than five years. Meanwhile, last week’s dollar volume of insider buying nearly doubled week-over-week, whereas the volume of insider selling nearly halved relative to the volume registered in the previous week. It’s worth pointing out that the insider buying recorded this May has been higher than the buying volume registered in the same month of the past three years or so. This is great news for the investment community, so, based on historical patterns, one may expect U.S. equities to go higher in the weeks and months ahead. Insider Monkey processed numerous Form 4 filings submitted with the SEC on Friday and picked five companies with eye-catching insider trading activity.

Academic research has shown that certain insider purchases historically outperformed the market by an average of seven percentage points per year. This effect is more pronounced in small-cap stocks. Another exception is the small-cap stock picks of hedge funds. Our research has shown that imitating the 15 most popular small-cap stocks among hedge funds outperformed the market by nearly a percentage point per month between 1999 and 2012 (read more details here).

Car Rental Giant Witnesses Two Executives Purchase Shares

Hertz Global Holdings Inc. (NYSE:HTZ) has seen two executives purchase shares since the beginning of June. To start with, Tyler A. Best, Chief Information Officer and Executive Vice President, purchased 45,000 shares on Thursday at a price of $10.02 per share, boosting his overall holding to 72,450 shares. Joining Mr. Best was Alexandria Panot Marren, Executive Vice President of North American Rental Car Operations, who bought 10,000 shares on Wednesday at a weighted average price of $9.90. Ms. Marren currently owns 50,282 shares of Hertz Global, which include 40,282 restricted stock units.

The car rental giant has seen its market value decline by 29% since the beginning of the year. Hertz Global Holdings Inc. (NYSE:HTZ)’s disappointing performance in recent months has been impacted by a decline in rental prices across the globe. The company’s revenues for the first three months of 2016 were $2.31 billion, down from $2.45 billion recorded a year ago mainly due to a decrease in revenues of $114 million in the U.S. Car Rental segment. As mentioned, the decrease in U.S. car rental revenues was mainly driven by lower rental rates. Carl Icahn’s Icahn Capital LP was the owner of 63.71 million shares of Hertz Global Holdings Inc. (NYSE:HTZ) at the end of March.

Let’s head to the next pages of this insider trading article, where we will discuss several noteworthy insider trading transactions recorded at four other companies.

Media Tech Company Has Board Member Buy Shares

One of Avid Technology Inc. (NASDAQ:AVID)’s Board members, Paula E. Boggs, purchased a new stake of 16,500 shares on Thursday at prices varying from $6.08 to $6.21 per share. The newly-acquired stake is held through Boggs LLC, of which Ms. Boggs is the majority owner. The Board member also holds a direct ownership stake of 27,183 shares.

The shares of the developer of software and hardware for digital media content publication, management and distribution are down 66% in the past year. Avid Technology Inc. (NASDAQ:AVID)’s shares seem to be trading cheaply at the moment if considering the stock’s forward PE multiple of only 4.6, which is below the forward PE ratio of 16.2 for the information technology (IT) sector. The company’s top-line figure for the first three months of the year was $143.55 million, up from $119.59 million posted a year ago. Avid Technology also posted net income of $20.93 million, versus a net loss of $0.17 million recorded in the same period of the prior year. Jeffrey Bronchick’s Cove Street Capital owns 2.31 million shares of Avid Technology Inc. (NASDAQ:AVID) as of March 31.

This Property and Casualty Insurer Sees CEO Buy Shares

Hallmark Financial Services Inc. (NASDAQ:HALL)’s top executive resumed the buying spree after a break of nearly two years. Chief Executive Officer and President Naveen Anand snapped up 10,300 shares on Thursday at $9.84 apiece, lifting his overall holding to 60,300 shares.

The diversified specialty property and casualty insurer has seen its shares go down by nearly 18% since the start of the year. Hallmark Financial Services Inc. (NASDAQ:HALL)’s financial performance has been partially impacted by sustained deterioration in the non-standard automobile business, which generally insures new or young drivers, drivers with credit problems, drivers with multiple losses or moving violations, among others. As a result of the aforementioned issue and other issues, the company has been raising rates across most of its customer categories. Jim Simons’ Renaissance Technologies LLC reported owning 158,400 shares of Hallmark Financial Services Inc. (NASDAQ:HALL) in its latest 13F.

Two Executives at Best Buy Co Inc. (NYSE:BBY) Offload Shares

To begin with, Chairman and Chief Executive Officer Hubert Joly discarded a massive amount of 398,000 shares on Thursday at prices ranging from $32.06 to $32.49 per share, cutting his ownership to 511,138 shares. However, the sole purpose of Mr. Joly’s huge sale involved the diversification of his portfolio, as revealed in the Form 4 filing that disclosed the sale. Mathew Watson, Vice President of Finance, Controller and Chief Accounting Officer, unloaded 1,363 shares on Tuesday for $32.10 each, after which Mr. Watson continues to hold 20,668 shares.

The shares of the provider of technology products, services and solutions are up 6% thus far in 2016. At the end of May, analysts at Deutsche Bank downgraded Best Buy Co Inc. (NYSE:BBY) to ‘Hold’ from ‘Buy’ and reduced the price target on the stock to $32 from $38, after the company’s Chief Financial Officer announced plans to step down. The downgrade also reflects the absence of cost cutting efforts at the company, as well as worries over the consumer electronics retailer’s sales outlook for the second half of the year. Renaissance Technologies LLC added a 2.35 million-share position in Best Buy Co Inc. (NYSE:BBY) during the January-to-March period.

Provider of Non-Medical Support Services to the Healthcare Industry Sees Its Founder Sell Shares

Daniel P. McCartney, the Chairman of Healthcare Services Group Inc. (NASDAQ:HCSG)’s Board, sold 100,000 shares on Thursday at $39.39 apiece, trimming his ownership to 2.16 million shares. Mr. McCartney, who served as the Healthcare Services Group’s CEO until May 2015, founded the company in 1977 to provide non-medical support services to the healthcare industry. Thus, it appears that Mr. McCartney is simply cashing out a portion of his equity holdings in the company he founded for reasons unrelated to the company’s future prospects.

The largest provider of housekeeping and laundry management services to the long-term care industry in the U.S. has seen its market capitalization gain 13% since the start of the year and 153% in the past five years. The company provides management, administrative and operating services to more than 3,500 facilities in 48 states as of the end of March. Healthcare Services Group Inc. (NASDAQ:HCSG)’s revenues for the first three months of 2016 were $384.81 million, up from $355.25 million reported a year ago. Royce & Associates, founded by Chuck Royce, has 325,464 shares of Healthcare Services Group Inc. (NASDAQ:HCSG) in its equity portfolio at the end of the first quarter.

Disclosure: None