MTS Systems Corporation (MTSC) and Two Other Companies with Insider Buying that Involves Two or More Insiders

American Equity Investment Life Holding (NYSE:AEL) is yet another company that saw two executives purchase shares last week, though the transactions were not overly significant. Renee D. Montz, Executive Vice President and Deputy General Counsel, acquired 885 shares on Wednesday for $13.45 each, boosting her direct ownership stake to 2,753 shares. Ms. Montz also holds an indirect ownership stake of 957 shares, which is held through her employee stock ownership plan (ESOP). Moreover, Scott A. Samuelson, Vice President and Controller, purchased 3,000 units of common stock on the same day at prices that ranged from $13.44 to $13.45 per share, which lifted his direct-ownership holding to 8,888 units. Mr. Samuelson owns an additional 5,112 shares indirectly, which are held by the ESOP.

American Equity Investment Life Holding is an issuer of annuity and life insurance products that operates through several wholly-owned life insurance subsidiaries. To be more specific, the company’s core business involves the sale of fixed index and fixed rate annuities. The shares of the second biggest broker of index annuities in the U.S. have plummeted 22% in the past five days, after the Department of Labor announced tougher rules for selling more complex products such as indexed annuities. The so-called “fiduciary rule” will require companies to disclose more information about brokers’ compensation from sales of variable or indexed annuities, which is set to protect savers from receiving conflicted advice. Therefore, the freshly-revealed rule is anticipated to make it much more difficult for brokers such as American Equity Investment Life to earn commissions on the sales of financial products, as more people could turn their attention to low-cost index tracked funds.

Soon after the announcement of toughened rules, analysts at Sandler O’Neill downgraded the insurer of annuity and life insurance products to ‘Hold’ from ‘Buy’. Shares of American Equity Investment Life are down 55% in the past 52 weeks and change hands at around 4.8-times expected earnings, versus the forward P/E ratio of 17.4 for the S&P 500 gauge. The hedge fund sentiment towards the company declined in the December quarter, as the number of funds invested in the company dropped to 19 from 24 quarter-over-quarter. Ken Fisher’s Fisher Asset Management owns 2.71 million shares of American Equity Investment Life Holding (NYSE:AEL) as of December 31.

Disclosure: None