Top Executives at Seagate Technology PLC (STX), Infinera Corp. (INFN) and Tempur Sealy International Inc. (TPX) Are Loading Up on Shares

Infinera Has Two Top Executives Purchase Shares

Infinera Corp. (NASDAQ:INFN) saw its two most influential and informed executives purchase shares earlier this week. To start with, Chief Financial Officer Brad Feller purchased 25,000 shares on Tuesday at prices that ranged from $11.73 to $11.76 per share, lifting his overall holding to 86,628 shares. More importantly, Chief Executive Officer Thomas J. Fallon snapped up 100,000 shares on the same day at prices that fell between $11.77 and $12.00 per share, all of which are held directly by the Fallon Family Revocable Trust, which currently owns 988,815 shares.

The maker of optical transport networking equipment has seen its market value drop by 36% since the beginning of 2016, partly owing to disappointing guidance issued for the ongoing quarter. In fact, the stock reached a new 52-week low of $11.50 on Tuesday, which explains why both the CFO and CEO bought massive blocks of shares on that day. Infinera recorded revenue of $244.8 million for the first quarter of fiscal year 2016 ended March 26, an increase from $186.9 million reported for the first quarter of fiscal year 2015. Infinera management projects fiscal second quarter revenue of $250 million-to-$260 million, notably below analysts’ average estimate of $272 million. This would also represent substantial top-line growth braking from the 31% growth recorded in the fiscal first quarter.

A number of analyst downgrades and price target cuts followed the release of Infinera’s latest financial results. Analysts at Citigroup downgraded the stock to ‘Neutral’ from ‘Buy’ and cut their price target on it to $17 from $20. Similarly, MKM Partners downgraded Infinera to ‘Neutral’ from ‘Buy’ and trimmed their price target to $15 from $21. The stock is priced at 13.3-times expected earnings, slightly above the forward P/E ratio of 12.3 for the communications equipment sector.

Rail-Splitter Capital Management, overseen by John Croghan and Richard Fradin, acquired a new stake of 472,321 shares of Infinera Corp. (NASDAQ:INFN) during the March quarter.

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