Investing

Massive Media and Retail Buys Highlight Insider Buying as Trump Rally Slows: Fred's, 21st Century Fox, Newcastle Investment, Wynn Resorts, Inovalon and More

Lee Jackson

Published: December 24, 2016 10:10 am

Last Updated: January 12, 2020 4:27 pm

With the market more than ready for the long three-day holiday weekend, volume really slowed near the end of last week, as traders and portfolio managers looked to consolidate some of the gains from the gigantic Trump rally that started right after the election. The pending holiday didn’t slow insiders from buying shares, and we continued to see some strong trading during the week.

We cover insider buying each week at 24/7 Wall St., and we like to remind readers that while insider buying is usually a very positive sign, it is not in of itself a reason to run out and buy a stock. Sometimes insiders and 10% owners have stock purchase plans set up at intervals to add to their holdings. That aside, it still remains an overall positive indicator.

Here are some of the companies that reported notable insider buying last week.

Fred’s Inc. (NASDAQ: FRED) soared last week on news that activist investors Alden Global Capital bought a huge position. The operator of retail discount stores and full service pharmacies purchased 5,533,005 shares in a trade that was valued at a massive $110 million. The company bought the shares at prices between $19.36 and $20.10. The consensus price target for the company is just $14. The shares were trading on Friday’s close at $20.20.

Twenty-First Century Fox Inc. (NASDAQ: FOXA) had a huge buyer taking down shares of the entertainment giant last week. Director Jeffrey Ubben bought a stunning block of 3 million shares at $27.78 apiece. The total for the buy was a massive $83,350,000. The Wall Street consensus price target for the stock is $31.40, and the shares closed on Friday at $28.38, so the timing looks good.

Newcastle Investment Corp. (NYSE: NCT) also had a director buying shares this past week. Wesley Edens picked up 1 million shares of the stock at a price of $4.37. The total for the trade was posted at $4,370,000. The consensus price target for the stock is $4.50. The company invests in and manages real estate related and other investments. Its stock ended the week at $4.31.

Reata Pharmaceuticals Inc. (NASDAQ: RETA) had two directors at the company buying shares last week. CPMG and Kent McGaughy together bought 164,753 shares of the clinical stage biopharmaceutical company at $22.99. The total for each trade came to a whopping $3,787,820. The consensus price target is a whopping $48, and shares closed on Friday at $22.04.

Wynn Resorts Ltd. (NASDAQ: WYNN) hits our insider screens for the second week running. Daniel Wayson, a director at the gaming giant, bought a total of 37,500 shares of the stock at $93.83 per share. The total for the buy was set at $3,518,625. The consensus price target is $98.38. The stock changed hands at $88.34 on Friday’s close.

Inovalon Holdings Inc. (NASDAQ: INOV) also had a director buying shares last week. Andre Hoffman purchased 200,000 shares at a price of $9.29. The total for the purchase was posted at $1,858,580. The consensus price target for the shares is $11. This technology company provides cloud-based data analytics and data-driven intervention platforms in the United States for health plans, hospitals, physicians, patients, pharmaceutical companies and researchers. Its stock closed Friday at $9.80.

These companies also reported insider buying last week:  Abbott Laboratories (NYSE: ABT), Amicus Therapeutics Inc. (NASDAQ: FOLD), Lonestar Resources U.S. Inc. (NASDAQ: LONE), Medley Capital Inc. (NYSE: MCC) and Spark Energy Inc. (NASDAQ: SPKE).

Also see the week’s top insider sales at Facebook, Netflix and more.

The continued strong buying volume when the market is trading at or near record highs remains a bullish sign for investors. After a solid 2016, insiders that are still buying shares are positive on 2017 and beyond.