Past research shows that there are predictable or routine insider trades that do not convey meaningful information for the future of firms, so retail investors monitoring insider trading activity need to learn how to filter out the information-rich trades from the routine ones. But how can investors differentiate between the two types of transactions?
Sales of freshly-exercised stock options or sales conducted under pre-arranged trading plans account for a high portion of the routine kind of insider trading. The insider selling related to freshly-exercised stock options or pre-arranged trading plans is mainly driven by diversification or liquidity needs, which is why these two kinds of insider trading are considered routine. Insider Monkey believes that spur-of-the-moment insider transactions represent a set of information-rich trades that contain much more useful information for possible stock movement than routine transactions which often say nothing at all. That said, the following article will discuss a set of informative insider transactions reported with the SEC on Tuesday.
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Several Insiders at Renamed Data and Analytics Company Purchase Shares
Let’s kick off our discussion with the insider buying observed at Cogint Inc. (NASDAQ:COGT), where several insiders purchased shares earlier this week. To start with, Ryan Schulke, the CEO of New York-based Fluent LLC, a wholly-owned subsidiary of Cogint, purchased 150,000 shares on Monday at a price of $3.15 per share, boosting his overall holding to 6.05 million shares. Matthew Conlin, President of Fluent LLC, snapped up 100,000 shares on the same day at a price tag of $3.15 each. Mr. Conlin currently owns an aggregate of 5.46 million shares after the recent purchase.
The data and analytics company adopted Cogint Inc. as its new name instead of IDI Inc. in mid-September of 2016, as well as re-listed from NYSEMKT to NASDAQ. The shares of Cogint Inc. (NASDAQ:COGT) are down by 34% since mid-September despite having gained 11% in the past three months. Due to strong revenue growth in the third quarter and continued momentum in the first part of the fourth quarter, the company’s management said they anticipate reaching their previously-communicated 2016 revenue guidance of $183 million to $187 million. Jim Simons’ Renaissance Technologies owned 23,100 shares of Cogint Inc. (NASDAQ:COGT) at the end of September.
The following two pages of this insider trading article will discuss the fresh insider buying and selling at four other companies.