At Insider Monkey, we follow insider trading activity and moves by companies’ biggest executives. Issued via Form 4 filings with the SEC, it’s typically better to track insider buying then selling, because there are many reasons why one would sell a stock, but only one reason to behave bullishly. Let’s take a look at four stocks with positive insider sentiment of late:
An investment group owned by the family trust of one of Philip Morris International Inc. (NYSE:PM)’s Board of Directors purchased over 120,000 shares of the cigarette company. Philip Morris International Inc. (NYSE:PM), which is internationally focused following the breakup of the larger Philip Morris International Inc. (NYSE:PM) organization (Altria Group Inc (NYSE:MO) has more of an emphasis on the U.S. market), experienced small declines in revenue and earnings last quarter compared to the second quarter of 2012. Its current dividend yield, of 3.8%, seems high but is in fact a full percentage point lower than the yields of some other cigarette stocks.
Another factor to track related to individual stocks is interest from hedge funds and other notable investors. We track quarterly 13F filings from these investors as part of our work researching investment strategies- we have found that the most popular small cap stocks among hedge funds generate an average excess return of 18 percentage points per year (learn more about our small cap strategy) and our own portfolio has outperformed the market by 33 percentage points in the last 11 months. According to our database, billionaire Ken Fisher’s Fisher Asset Management owned 5.6 million shares of Philip Morris International Inc. (NYSE:PM) at the end of the first quarter of 2013 (find Fisher’s favorite stocks).
A company officer at The Wendy’s Co (NYSE:WEN) was buying shares in early August at prices between $7.30 and $7.50 per share. The Wendy’s Co (NYSE:WEN)’s is valued at 29 times forward earnings estimates, even after Wall Street analysts expect decent increases in earnings per share both this year and next year. In addition, we would be concerned that The Wendy’s Co (NYSE:WEN)’s may have trouble dealing with competition from more premium quick service restaurants such as Chipotle Mexican Grill, Inc. (NYSE:CMG). 14% of the stock’s float is held short. Trian Partners, managed by billionaire Nelson Peltz, has been a major shareholder in The Wendy’s Co (NYSE:WEN)’s and most recently reported a position of a little over 83 million shares (check out more stocks Trian owns).
RadioShack Corporation (NYSE:RSH), the $260 million market cap electronics supply store (over 3 million shares of the stock are traded per day, so there is plenty of volume), has also been seeing insider buying activity recently. Thanks in part to stiff competition from Amazon.com, Inc. (NASDAQ:AMZN), RadioShack Corporation (NYSE:RSH) is expected to be unprofitable both this year and next year and the company’s sales were about flat in the second quarter of 2013 versus a year earlier. It is another popular short target, with 41% of the float held short. Jonathan Jacobson’s Highfields Capital Management bought about 3% of the company between January and March.
The CEO of Healthcare Trust Of America Inc (NYSE:HTA) bought 5,000 shares at an average price of $10.66 per share. The real estate investment trust invests in medical office buildings and other healthcare facilities. As an REIT, it receives favorable tax treatment conditional on distributing a large share of taxable income to shareholders. It pays quarterly dividends of 14.4 cents per share- making for a yield of 5.4% at current prices- but has a limited history as a public company. Renaissance Technologies, whose founder Jim Simons is now a billionaire, was buying the stock in the first quarter of the year (research more stocks Renaissance was buying).
Disclosure: I own no shares of any stocks mentioned in this article.