Market Overview

Insiders Buy Abbott Laboratories Shares After Merger Deal Sours

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  • Insiders at this healthcare products giant recently bought some of its shares.
  • Those purchases followed news of a merger gone sour.
  • The share price has drooped since those buys.

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 during periods of uncertainty. Case in point: recent notable buys at Abbott Laboratories (NYSE: ABT).

Two executive vice presidents at this healthcare products giant have bought 28,000 shares in the past week. The share prices for the purchases ranged from $38.45 to $39.09, for a total of around $1.1 million. Earlier this month, Abbott Labs filed to terminate its proposed merger with Alere Inc (NYSE: ALR), citing negative developments.

Abbott Labs has a market capitalization of more than $56 billion. Short interest is more than 5 percent of the float, but the consensus recommendation of analysts is to buy shares. The stock is trading at about the same price as a month ago, though it was up as much as 3.5 percent in that time. The share price is about 15 percent lower than a year ago, and the stock closed most recently at $38.26, below the executives' purchase prices.

 

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Posted-In: abbott laboratories AlereNews Insider Trades

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