Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Insiders Have Bought Freeport-McMoRan Copper & Gold Inc. (FCX), Iron Mountain Incorporated (IRM), and More

According to economic theory, company insiders should be quite hesitant to buy stock. Doing so increases their company-specific risk, therefore violating the principle of diversification, and so should tend to occur when insiders are particularly confident in the stock price. In fact, studies show a small outperformance effect for stocks bought by insiders (read our analysis of studies on insider trading). Investors can’t imitate every insider purchase, but we still think that it can be useful to review insider buys in search of interesting stocks worthy of further research- similar to the ways that stock screens are best used. Here are five stocks that insiders have bought recently:


Limited partnerships connected to the vice chairman of Freeport-McMoRan Copper & Gold Inc. (NYSE:FCX)’s Board of Directors purchased a total of 1.1 million shares of stock in early June. The company recently closed acquisitions of two oil and gas companies; the stock price has dropped over 20% since the deal was announced, leaving the stock paying a dividend yield of 4% at current dividend levels. We cover insider trading activity and also follow quarterly 13F filings from hedge funds and other notable investors. This information can be used to develop investing strategies (for example, we have found that the most popular small cap stocks among hedge funds outperform the S&P 500 by an average of 18 percentage points per year) and also lets us investigate interest in particular stocks. We can see that billionaire Leon Cooperman’s Omega Advisors owned 3.1 million shares of Freeport-McMoRan Copper & Gold Inc. (NYSE:FCX) as of the end of March (see Cooperman’s stock picks).

Insiders have also been buying on the recent dip at Iron Mountain Incorporated (NYSE:IRM); four different insiders bought shares on June 7th after the stock fell 16% on the news that the IRS may adopt a stricter definition of “real estate” which would prevent the company from converting to an real estate investment trust. REITs receive favorable tax treatment, and so bulls had been buying the stock on speculation that REIT conversion would be approved. Renaissance Technologies, whose founder Jim Simons is now a billionaire, reported a position of 1.5 million shares at the end of Q1 (find Renaissance’s favorite stocks).

Our database shows that mail services company Pitney Bowes Inc. (NYSE:PBI) also saw insider purchases recently, with an executive vice president buying 15,000 shares at an average price of $14.43 per share. While the earnings multiples are low- Pitney Bowes trades at only 8 times its trailing earnings- the company has been experiencing lower revenue and higher costs. As a result operating income fell nearly 50% in the first quarter of 2013 versus a year earlier. Tiger Global Management, a Tiger Cub hedge fund, had 1.8 million shares of Pitney Bowes in its portfolio at the beginning of April (check out more stocks Tiger Global owned).

DOWNLOAD FREE REPORT: Warren Buffett's Best Stock Picks

Let Warren Buffett, George Soros, Steve Cohen, and Daniel Loeb WORK FOR YOU.

If you want to beat the low cost index funds by 19 percentage points per year, look no further than our monthly newsletter.In this free report you can find an in-depth analysis of the performance of Warren Buffett's entire historical stock picks. We uncovered Warren Buffett's Best Stock Picks and a way to for Buffett to improve his returns by more than 4 percentage points per year.

Bonus Biotech Stock Pick: You can also find a detailed bonus biotech stock pick that we expect to return more than 50% within 12 months.
Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.