Insider buying and selling spiked last week after sinking the week before. After a huge jump to yearly highs in early September, insider buying has cooled off, though the 136 purchases made on October 2 was a 2018 high. Insiders sold $1.22 billion worth of stock last week, nearly ten-times the amount that insiders purchased ($124 million).
In the past two weeks, several companies’ shares were purchased by multiple members of their leadership teams. Such clusters of insider buying tend to signal stocks that will outperform the market over the following 12-month period, which makes them savvy plays for any investor. We’ll take a look at the recent clusters of insider buying witnessed at Verastem Inc (NASDAQ:VSTM), Arlington Asset Investment Corp (NYSE:AI), and U.S. Silica Holdings Inc (NYSE:SLCA) below.
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Verastem Inc (NASDAQ:VSTM)
It’s been a veritable feeding frenzy for Verastem Inc (NASDAQ:VSTM) shares among the company’s officers and directors in recent days. Since September 27, no less than six members of the company’s executive team have purchased shares. Among them were EVP & CCO Joseph Lobacki (3,000 shares), COO Dan Paterson (5,000 shares), President & CEO Robert Forrester (12,500 shares), and Directors Brian Stuglik (1,000 shares), Timothy Barberich (5,000 shares) and Michael Kauffman (4,000 shares).
After pushing past the $10 mark in late August, Verastem Inc (NASDAQ:VSTM) shares have sunk by over 30% since, which precipitated the insider buying surge. Despite the recent setback, Verastem shares are still more than double what their value was at the start of 2018. Just ahead of that insider buying, Verastem’s Copiktra (duvelisib) became the company’s first treatment to be approved by the FDA. Rather than rejoice, investors grew cautious, as Verastem must now undertake the daunting task of meeting sales expectations against competing drugs from heavyweights like Bayer and Gilead Sciences, Inc. (NASDAQ:GILD). Verastem Inc (NASDAQ:VSTM)’s leadership certainly appears to be confident of their prospects, which should likewise embolden investors.
On the next page we’ll look at two other companies where multiple insiders have been buying shares recently.