The much-scrutinized earnings recession may finally come to an end. According to FactSet, the blended earnings decline for the companies comprising the S&P 500 currently stands at 0.3%, as compared to the 2% earnings decline anticipated by analysts at the end of the third quarter. The blended results combine actual results for the companies that have already released their earnings reports and the estimated results for the companies yet to release their reports.
Regardless of whether the earnings recession finally comes to a halt or not, there is a visible positive trend for the bottom-line figures released by U.S. publicly traded companies. However, should the S&P 500 Index record a decline in earnings this quarter, the so-called earnings recession will expand to six consecutive quarters of year-over-year declines in earnings. With U.S. companies gradually releasing their third-quarter earnings reports, one could anticipate insider trading activity to pick up soon. Although most companies’ blackout periods for insiders continue to restrict Board members and executives from buying and selling shares, there is some insider trading activity that may be worth the attention of the investment community. Hence, this article will lay off a set of noteworthy insider transactions reported with the SEC on Friday.
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Chairman of Automotive Replacement-Parts Distributor Buys Shares After Earnings Disappointment
According to our insider trading database, Genuine Parts Company (NYSE:GPC) recently observed the first insider purchase of 2016. Thomas C. Gallagher, Chairman of the company’s Board of Directors who handed over the reins of the company earlier this year, purchased 3,000 shares on Thursday for $89.24 each. After the recent purchase, the former Chief Executive Officer of the distributor of automotive replacement parts currently holds an ownership stake of 564,498 shares. While some might have anticipated Mr. Gallagher to unload shares after stepping down from his role as CEO, he is actually boosting his stake – a positive sign for the investment community indeed.
The insider buying comes shortly after the automotive replacement-parts distributor released disappointing results for the third quarter, an earnings release that sent the shares down 7% in the past five trading sessions. Genuine Parts Company (NYSE:GPC) lowered its guidance for the year, with earnings per share being expected to fall in the range of $4.55-to-$4.60 versus the previous outlook of $4.70-to-$4.75. The company also said it anticipates an increase in sales of 0%-to-1%, down from the previous guidance of 1%-to-2%. Genuine Parts shares are 5% in the green this year. David Harding’s Winton Capital Management owned 292,394 shares of Genuine Parts Company (NYSE:GPC) at the end of the second quarter.
The next two pages of this insider trading article discuss more insider trading activity reported with the SEC on Friday.