- Insider buying can be an encouraging signal for potential investors.
- A CEO added to his stake last week after shares sank to a low.
- An insider bought some shares on the same day the CEO was selling.
Conventional wisdom says that insiders and 10 percent owners really only buy shares of a company for one reason -- they believe the stock price will rise and they want to profit from it. So insider buying can be an encouraging signal for potential investors, particularly with markets near all-time highs.
Here's a look at a few notable insider purchases reported in the past week.
Walgreens Boots Alliance Inc WBA saw CEO Stefano Pessina add to his stake early last week. At $63.92 apiece, the more than 1.69 million shares reportedly acquired cost the company's single largest shareholder about $108.5 million. Note that another executive bought 1.70 million shares at about the same time.
Walgreens shares sank to a 52-week low of $59.07 at the end of June, on fears that Amazon's online pharmacy acquisition would shake up the industry. However, the stock ended last week at $64.98, above Pessina's purchase price. It has traded as high as $83.89 in the past year, but the Wall Street consensus price target was last seen at $71.32.
A BlackRock, Inc. BLK director stepped up to the buy window again this past week. The 1,000 shares of this New York-based investment manager acquired, at a per-share price ranging from $507.885 to $508.11, cost him $507,983. Note that on the same day, CEO Larry Fink sold 19,800 shares.
BlackRock posted better-than-expected earnings, raised its dividend and expressed interest in bitcoin last week. Its shares ended the week trading at $502.87, about where it began and less than the purchase range mentioned above. The stock has changed hands between $408.62 and $594.52 in the past year, and the analyst's mean price target is $589.25.
A DISH Network Corp DISH executive vice president bought 5,000 shares of this pay-TV provider early last week. At $32.99 a share, the transaction totaled $164,950. The executive made two similar purchases earlier this month, pursuant to a 10b5-1 trading plan, and the stake was last reported to be up to more than 1.16 million shares.
The Federal Communications Commission has been asking questions about Dish's network build-out plan. Shares pulled back around 7 percent in the past week and closed Friday at $30.91 apiece. The share price has been as high as $66.50 in the past year, but the consensus price target is just $54.52.
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