Why Are Corporate Insiders At These Companies Going Against The Bearish Crowd?

Let’s now turn our focus on Middleburg Financial Corp. (NASDAQ:MBRG), which had five different insiders buy stock during the previous week. However, we will examine only the most noteworthy activity. To start with, Director Alexander G. Green III reported acquiring 2,500 shares at a price of $17.50 per share, adding to his position that now stands at 9,135 shares. Another Director on Middleburg’s Board of Directors, Childs F. Burden, increased his holding by 1,000 shares to 17,320 shares through a single transaction at an approximate price of $17.82 apiece. Janet A. Neuharth, another Director, bought 540 shares for $17.70 each last week, and currently holds a 3,140 share-stake. Earlier this month, the holding company for Middleburg Bank announced its plans to repurchase up to $10 million or roughly 8% of its outstanding common stock, but as Carl Icahn suggests, share buybacks are weakening companies’ balance sheets in exchange for short-term benefits (e.g. increasing earnings per share). Even so, Middleburg does not have to invest in plants, equipment, or other future-thinking projects, which means that share buybacks are an efficient way of spending cash in its case. Jim Simons’ Renaissance Technologies is one of the few hedge funds within our database invested in Middleburg Financial Corp. (NASDAQ:MBRG), owning 25,500 shares as of June 30.

Finally, we will look into the insider trading activity at Helmerich & Payne Inc. (NYSE:HP). Gordon K. Helm, Vice President and Controller, purchased 4,000 shares at $47.01 per share on Friday. Following the transaction, the executive holds a stake of 35,768 shares. The shares of the contract drilling company have had a rough year so far, losing 31% year-to-date. Just recently, RBC Capital Markets issued a report on Helmerich & Payne, downgrading the stock to “Sector Perform” from “Outperform” and reducing its price target to $55 from $83. According to the trading and research hub, the overcapacity of land drilling and the company’s high valuation are two main factors that limit its upside potential. However, the newly-updated price target yields an upside of more than 18% from the current price, though that should serve as a medium- or long-term target rather than a short-term one. It is also true that the executive has his own views on the prospects of Helmerich & Payne and the oil industry in general, which might actually point to the stock’s turnaround in the upcoming months and years. Chuck Royce’s Royce & Associates reported an ownership stake of 1.02 million shares in Helmerich & Payne Inc. (NYSE:HP) the latest round of 13F filings.

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