Insider Buying Heating Up At Worthington (WOR), Knowles (KN), and Churchill Downs (CHDN)

At Insider Monkey, we track insider trading and hedge fund activity to uncover actionable patterns and profit from them. Large-scale studies of insider buying data have showed that stocks with noteworthy insider purchases outperform the market by as much as 11% annually on average, making insider buying a highly useful measure of a stock’s value (and more importantly, its future performance) for investors.

Among the recently uncovered insider buying of note were purchases made by insiders at Worthington Industries, Inc. (NYSE:WOR), Knowles Corp (NYSE:KN), and Churchill Downs, Inc. (NASDAQ:CHDN). We’ll look at those moves and what likely spurred them below.

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Worthington Industries, Inc. (NYSE:WOR)

Who Bought Shares: Director Michael Endres

How Many Shares Were Bought: 3,000 @ $39.78

Date of the Transaction(s): April 4

The director’s purchase was the first by a Worthington Industries, Inc. (NYSE:WOR) insider in over three years and followed a steep decline in shares in late-March/early-April following the company’s fiscal third-quarter results being released. Those results of $841 million in revenue (up by nearly 20% year-over-year) and EPS of $0.61 (when not including a $0.66 per share tax cuts benefit) missed estimates of $861 million and $0.72 per share respectively.

Worthington Industries, Inc. (NYSE:WOR)’s Integration of Amtrol Proving Successful: During the company’s fiscal third-quarter conference call, EVP and CFO Andy Rose declared that Worthington’s integration of Amtrol has “gone well”, improving Worthington’s consumer and industrial products divisions. A manufacturer of water system tanks and pressure cylinders, Amtrol was acquired last June for $283 million.

On the next page we’ll look at the recent insider trading activity at Churchill Downs, Inc. (NASDAQ:CHDN) and Knowles Corp (NYSE:KN).

Churchill Downs, Inc. (NASDAQ:CHDN)

Who Bought Shares: Director Richard Duchossois

How Many Shares Were Bought: 8,125 @ $246.42 per share

Date of the Transaction(s): March 23 to April 3

The director has long been one of the most active insiders at Churchill Downs, Inc. (NASDAQ:CHDN),with his clusters of purchases often preceding sharp rises in the stock. Previously, that included three purchases last May ahead of the gaming company stock’s massive rally that would see it gain close to 40% throughout the remainder of 2017. The four recent purchases are owned indirectly through RLD Revocable Trust. In addition, the director made a purchase of 3,680 shares on March 7 that are owned directly.

Historical Racing Machine Parlor Slated to Open This Year: Churchill Downs, Inc. (NASDAQ:CHDN) is scheduled to open an 85,000-square-foot parlor at its Trackside training center in Louisville later this year. The machines are expected to generate enough revenue to increase purses for the track’s horse races, as they have at Kentucky Downs. Parlors located at three other tracks in the state generated over $2 billion in wagering in 2017.

Knowles Corp (NYSE:KN)

Who Bought Shares: Intelligent Audio President Michael Polacek

How Many Shares Were Bought: 1,178 @ $12.36

Date of the Transaction(s): April 2

Polacek and fellow insider Didier Hirsch have been actively buying shares of Knowles Corp (NYSE:KN) over the past six months, amounting to more than 10,000 shares in total. Shares have yet to experience the turnaround likely envisioned by those insiders, as they’ve fallen by over 13% in 2018.

Knowles Corp (NYSE:KN) Continues Transition Towards Audio Solutions: Knowles, which manufactures a wide range of audio products and components, suffered from weaker demand for its components from Chinese handset makers in 2017. On the other hand, headset sales more than doubled, and the company expects that market, as well as the IoT market (smart speakers), to be strong drivers of growth this year. Towards the end of 2017, Knowles unloaded its low-margin timing device business for $130 million, allowing it to pay its debt down to its lowest levels since the company went public.

Disclosure: None