The Chief Executive Officers of These Four Companies Buy Shares, Plus Insider Selling at Sanmina Corp (SANM)

There is little doubt that tracking insider trading activity should represent a major part of the stock selection and analysis process of most investors. Some hedge fund vehicles, viewed as the sports cars of the investment world for generating strong returns (albeit they have been struggling to beat stock market gauges in recent years), also incorporate insider trading data into their security analysis process.

Despite the fact that insider buying tends to offer more accurate insights about a company’s prospects than insider selling, the latter type of activity should not be ignored by any means. Although insiders sell shares for numerous reasons unrelated to their company’s future prospects, it is highly unlikely that they ignore the timing of their trades. Why would an insider selling shares today if he/she knows that the upcoming earnings reports will positively surprise the market? The bottom line is that insiders may unload their holdings when there are no major positive developments anticipated at their companies in the near-term future. That being said, this daily article on insider trading will discuss several insider buys and sales reported with the SEC on Monday.

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Mini-Cluster of Insider Buying at Provider of Food, Facilities and Uniform Services

Two insiders at Aramark (NYSE:ARMK) purchased shares in the past several trading sessions. To begin with, Board member Stephen I. Sadove purchased 7,500 shares on Thursday at prices ranging from $33.44 to $33.94 per share, lifting his overall holding to 22,488 shares. More importantly, President and CEO Eric J. Foss snatched up 87,566 shares on Monday at prices that fell between $34.25 and $34.79 per share. After the Monday purchase, Mr. Foss currently owns an aggregate of 1.51 million shares.

The bulk of insider buying comes shortly after the shares of the global provider of food, facilities and uniform services plunged due to disappointing results for its fourth quarter of fiscal 2016. Aramark (NYSE:ARMK) reported sales of $3.54 billion for the quarter that ended September 30, slightly down from the $3.55 billion-figure recorded a year ago. The company’s fourth-quarter top line missed analysts’ expectations of $3.67 billion. The Board of Directors of the food, facilities and uniform services specialist approved an 8%-increase in the quarterly dividend to $0.103 per share. The increased quarterly dividend equates to an annual dividend yield of 1.20%. Shares of Aramark are up 6% thus far in 2016 despite suffering a 7%-drop in the past month. Michael Lowenstein’s Kensico Capital was the owner of 8.56 million shares of Aramark (NYSE:ARMK) at the end of the third quarter.

The next two pages of this insider trading article will discuss fresh insider purchases and sales observed at four other companies.

CEO of Allergan Buys Shares Amid Stock Price Weakness

Two high ranking executives at Allergan plc (NYSE:AGN) recently filed Form 4 filings with the SEC to disclose fresh purchases of shares. President and CEO Brenton L. Saunders snapped up 5,250 shares on Monday at prices varying from $188.43 to $189.81 per share. Following the recent purchase, the CEO currently holds an ownership stake of 106,564 shares. On November 11, Chief Financial Officer Maria Teresa Hilado bought 1,422 shares at prices that ranged from $208.00 to $213.31 per share. Ms. Hilado currently owns 13,379 shares.

In late July of 2015, Allergan plc (NYSE:AGN) agreed to sell its global generic pharmaceuticals business and certain other assets to Teva Pharmaceutical Industries Ltd (ADR) (NYSE:TEVA). Upon the closing of the deal in early August, Allergan received $33.3 billion in cash and 100.3 unregistered Teva ordinary shares with an aggregate value of around $5.0 billion at closing. In early October, the world’s biggest generic drugmaker acquired Allergan’s Anda Distribution business for an additional $500.0 million, a business that distributes generic, brand, specialty and OTC pharmaceutical products from more than 300 manufacturers to retail independent and chain pharmacies, nursing homes, mail order pharmacies, hospitals, clinics and physician offices across the United States. The shares of Allergan are 38% in the red this year. Dan Loeb’s Third Point LLC trimmed its stake in Allergan plc (NYSE:AGN) by 23% during the third quarter to 3.79 million shares.

CEO of Strong Performing Semiconductor-Equipment Maker Buys Shares

The man in charge of Kulicke and Soffa Industries Inc. (NASDAQ:KLIC) boosted his ownership stake through a large series of transactions this past week. President and CEO Fusen Ernie Chen increased his holding from 166,163 shares to 191,163 shares during the last two days of the previous week at prices varying from $14.52 to $15.33 per share.

Kulicke and Soffa Industries Inc. (NASDAQ:KLIC) designs, manufactures and sells capital equipment and expendable tools used to assemble semiconductor devices such as integrated circuits, high and low powered discrete devices, light-emitting diodes, and power modules. Although the shares of the semiconductor-equipment maker currently trade slightly under their 52-week high of $15.37, the company’s recently-appointed CEO bought shares without hesitation. The shares of Kulicke and Soffa Industries are 30% in the green so far this year, partly reflecting strong results for the quarter that ended October 1. While the company’s management anticipates the industry to return to a more normalized growth rate in the foreseeable future, Dr. Chen assured investors that the company’s process of driving efficiency through the manufacturing process and supply chain will enable the semiconductor-equipment maker to navigate the softer near-term outlook. Royce & Associates, founded by Chuck Royce, reported owning 1.68 million shares of Kulicke and Soffa Industries Inc. (NASDAQ:KLIC) in its 13F for the third quarter.

The final page of this article will discuss some insider buying observed at one company, and fresh insider selling at another company.

High Ranking Insiders at Shopping Center Owner and Operator Buy Shares Amid Accounting Scandal

Two insiders at Brixmor Property Group Inc. (NYSE:BRX), including the man at the helm of the company, increased their holdings over the past several days. President and CEO James M. Taylor Jr. bought 10,000 shares on Monday at prices in the range of $23.80 to $23.84 per share, a purchase that lifted his overall ownership to 213,590 shares. John G. Schreiber, the Chairman of the company’s Board of Directors, disclosed the purchase of a 10,000-share stake that is held by Centaur Partner IV LP. The purchase occurred on Friday at a price tag of $23.70 each. Mr. Schreiber also holds a direct ownership stake of 5,000 shares.

The shares of the internally-managed REIT that owns and operates the second largest open air retail portfolio in the United States, comprised predominantly of community and neighborhood shopping centers, are down 7% this year. In early February, Brixmor Property Group Inc. (NYSE:BRX) announced that its Board had concluded that accounting and financial reporting personnel had been “smoothing income items” between reporting periods to show consistent growth in same-property net operating income. As a result, federal prosecutors opened an investigation on the shopping center owner’s accounting woes in late October. Jim Simons’ Renaissance Technologies LLC was the owner of 3.14 million shares of Brixmor Property Group Inc. (NYSE:BRX) at the end of September.

CEO of High-Flying Sanmina Discards Shares

Let’s now turn our attention to some fresh insider selling observed at Sanmina Corp (NASDAQ:SANM), where the man in charge of the company offloaded a great deal of shares last week. Chairman and CEO Jura Sola liquidated 57,892 shares on Thursday and 13,524 shares on Friday at prices that fell between $31.30 to $31.75 per share. Mr. Sola currently holds a direct ownership stake of 419,484 shares following the transactions discussed above.

The global provider of integrated manufacturing solutions, components, products and repair, logistics and after-market services has seen its market capitalization jump by 54% since the start of the year. The hefty increase in the company’s share price does explain the recent spike in insider selling at Sanmina Corp (NASDAQ:SANM), so investors should not be overly concerned about the sales mentioned earlier. Earlier this month, the company reported revenue of $6.48 billion for fiscal year that ended October 1, up from $6.37 billion recorded for the previous fiscal year. As for the first quarter of fiscal 2017 ending December 31, Sanmina anticipates revenue in the range of $1.675 billion-to-$1.725 billion. Cliff Asness’ AQR Capital Management added a 721,543-share stake in Sanmina Corp (NASDAQ:SANM) to its portfolio during the third quarter.

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