Our research has shown that stocks with multiple insider purchases outperformed the market by an average of 7 percentage points per year. Over the past days –since the beginning of September, a few companies –Southern Copper Corp (NYSE:SCCO), Cousins Properties Inc (NYSE:CUZ), and Nuverra Environmental Solutions, Inc (NYSE:NES), saw their insiders buy millions of dollars in stock. Let’s take a look at some of these millionaire transactions in order to find out if any of these companies deserve further research.
First in this list is Southern Copper Corp (NYSE:SCCO), a $27.4 billion market cap producer of copper, molybdenum, zinc and silver. On September 2, German Velasco Mota Larrea, Chairman of the Board, spent $1.62 million in stock. Following the purchase of 50,000 shares of Common Stock, for $32.56 per share, the insider owns 869,367 shares of the company, worth more than $27 million at current stock prices. Mr. Velasco has been quite active this year. Since late-March, the Chairman acquired 622,593 shares of the company. I should highlight, however, that Mr. Velasco is the only insider that has bought the company’s stock in more than three years.
Accompanying the Chairman, several hedge funds have also been increasing their stakes in Southern Copper Corp (NYSE:SCCO). The largest hedge fund shareholder of record –amongst those we track, Richard Chilton’s Chilton Investment Company, last disclosed a 66% boost in its exposure to the basic materials company, and now owns 847,268 shares of Common Stock.
Another company that saw a millionaire insider purchase in September is Cousins Properties Inc (NYSE:CUZ), a $2.9 billion market cap real estate investment trust. Also on September 2, Thomas G. Cousins, Chairman Emeritus, bought 260,000 shares of Common Stock for $12.75 each, in a transaction that totaled $3.31 million. Following this purchase, the insider holds 6.26 million shares of the company, directly, and another 1.81 million shares, indirectly, though holdings of diverse natures.
Major hedge funds are also quite bullish on Cousins Properties Inc (NYSE:CUZ). The three largest hedge fund shareholders of record are Cliff Asness’ AQR Capital Management, Chuck Royce’s Royce & Associates and Jim Simons’ Renaissance Technologies, which own 713,541 shares, 421,710 shares, and 332,316 shares, respectively. Both AQR and Renaissance boosted their stakes over the second quarter, while Royce & Associates kept it unaltered.
Last in this list is Nuverra Environmental Solutions, Inc (NYSE:NES), a small-cap firm that provides environmental solutions to customers focused on the development and ongoing production of oil and natural gas from shale formations. The company saw two insiders acquire its stock since the beginning of the month. Between September 4 and September 5, Mark D. Johnsrud, Chief Executive Officer and Chairman of the Board, acquired 124,551 shares of Common Stock. He paid prices ranging from $13.23 per share to $14 per share, and now owns more than 9.78 million shares, after spending more than $1.7 million in stock. In addition, Joseph M. Crabb, Executive Vice President and Chief Legal Officer, bought 5,000 shares for an average price of $13.18 each, and now owns 14,000 shares of Nuverra Environmental Solutions, Inc (NYSE:NES).
D. E. Shaw, the largest long hedge fund shareholder of record, also boosted its exposure to Nuverra Environmental Solutions, Inc (NYSE:NES). During the second quarter, the fund upped its bet by 62%, and now owns 126,186 shares of the company, worth more than $2.5 million.
Disclosure: Javier Hasse holds no positions in any stocks or funds mentioned.