Insider Buying Jumps as Market Rally Slows: SunOpta, Fiesta Restaurant, IFF, Chesapeake Energy, LaJolla Pharmaceutical and More

Investing

Published: March 12, 2017 10:20 am

Last Updated: January 12, 2020 2:02 pm

After a breathtaking rally that started with the election of President Trump, the huge parabolic upside move finally slowed some this week, and insiders took notice. For really the first time this year, we saw the pace of insider buying jump, and that may signal that while the rally could still have some legs, things are finally calming down. At any rate, an increase in insider buying is a positive sign for investors, especially in those companies that saw purchasing.

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 companies that reported notable insider buying last week.

SunOpta Inc. (NASDAQ: STKL) had an institutional buyer that also is a 10% owner of the company making a giant purchase last week. Oaktree Capital bought a giant 3 million share block at prices that ranged from $6.87 to $6.95. The total for the trade was posted at a sizable $20 million. The shares closed last Friday at $7.30, so the timing looks good. The 52-week trading range for the stock is $3.16 to $7.70, and the Wall Street consensus price objective is $8.38.

Another company that saw big institutional buying last week was Fiesta Restaurant Group Inc. (NASDAQ: FRGI). Early in the week, Leucadia National purchased 660,000 shares of the fast-casual restaurants operator’s stock at prices that ranged from $19.83 to $20.68. The total for that buy was $14 million. Then later in the week, it followed up with an additional buy of 347,000 shares at between $20.69 and $20.96. The total for that buy was $7 million. The shares closed Friday at $21.70, so some timely buys, it would appear. The 52-week trading range is $19.40 to $37.75, and the consensus price target is $24.20.

International Flavors & Fragrances Inc. (NYSE: IFF) is yet another company that hit our screens that saw a 10% institutional owner buying stock. Winder Investments purchased a total of 140,000 IFF shares at prices that ranged from $123.40 to $125.10. The total for the trade was a solid $18 million. The shares ended trading last Friday at $125.33. The 52-week range is $108.27 to $143.64, and the consensus price target is $131.57.

Investors who own Chesapeake Energy Corp. (NYSE: CHK) shares will be glad to know that two members of the company’s board were busy buying stock last week. Early in the week, a director bought 50,000 shares at $5.39 apiece. The total for that purchase was $300,000. Later in the week another board member got really serious and picked a 500,000 share block of the stock at between $5.22 and $4.26 a share. The total for that trade was $3 million. The stock closed last Friday at $5.15, in a 52-week range of $3.58 to $8.20, and the consensus price target is $7.43.

LaJolla Pharmaceutical Inc. (NASDAQ: LJPC) had almost every C suite executive at the biotech company buying shares last week. The chief executive, chief operating officer, chief financial officer, chief medical officer and a director bought a total of 106,100 shares of the stock at prices that ranged from $33.95 to $35.33. The total for the collective buy was set at $4 million. The stock closed last Friday at $36.06, so another well-time set of buys. The consensus price objective is a whopping $55.80, and the 52-week range is $14.24 to $37.67.

These companies also reported insider buying last week: Blackstone Minerals L.P. (NYSE: BSM), Cenveo Inc. (NYSE: CVO), NRG Energy Inc. (NYSE: NRG), Sotheby’s (NYSE: BID) and Trade Desk Inc. (NASDAQ: TTD).

While the inside sellers still surpassed the buyers this week, the difference was far less than what we have seen in 2017. For those hoping for a continuation of the Trump rally, this may just be the anecdotal evidence needed to help push things higher.

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