The year started off slow as far as insider purchases go. However, a huge insider buy at a biopharmaceutical raising funds changed that. Not only that, but activist investor Carl Icahn boosted his stake in a petroleum refiner, and another biotech company also had a beneficial owner return to the buy window. Let’s take a quick look at these and other notable transactions.
Is Insider Buying Important?
What does insider buying tell us?
A well-known adage reminds us that corporate insiders and 10% owners really only buy shares of a company because they believe the stock price will rise and they want to profit from it. Thus, insider buying can be an encouraging signal for potential investors. This is all the more so during times of uncertainty in the markets, and even when markets are near all-time highs.
Remember that the new earnings-reporting season has begun, so many insiders are prohibited from buying or selling shares. Below are some of the more notable insider purchases that were reported since the beginning of the year, starting with the largest and most prominent.
Immunovant
New York-based biotech sees huge insider buying.
- Buyer(s): 10% owner Roivant Sciences
- Total shares: over 16.8 million
- Price per share: $20.00
- Total cost: around $336.9 million
This transaction was part of a private placement of 22.5 million shares to raise funds to develop the biopharmaceutical company’s pipeline and for working capital. New York-based Immunovant Inc. (NASDAQ: IMVT) is currently focused on developing a treatment for Graves disease. Compared to a year ago, the stock is down over 42%, and it recently sank to a 52-week low of $22.41 per share. The $50.00 consensus price target suggests the share price could more than double in the next 52 weeks, and that target would be an all-time high. The consensus recommendation is to buy shares, and it has been for at least three months. Note that the buyer’s stake is up to more than 96 million shares.
CVR Energy
Carl Icahn scoops of shares of two related companies.
- Buyer(s): 10% owner Carl Icahn
- Total shares: more than 878,200
- Price per share: $18.25
- Total cost: over $16.0 million
In November and December, Icahn was buying shares of fertilizer maker CVR Partners L.P. (NYSE: UAN | CVI Price Prediction), a spinoff of petroleum refiner CVR Energy Inc. (NYSE: CVI). Icahn owns around two-thirds of the latter’s stock. Its share price is up more than 12% since the beginning of the year, outperforming the broader market, yet it is still over 40% lower than a year ago. Shares were last seen trading more than two bucks higher than the purchase price above. None of the seven analysts who cover the stock recommend buying shares, and their consensus price target is lower than the current share price. Goldman Sachs reiterated its Sell rating last month.
ModivCare
Who anticipates a strong recovery?
- Buyer(s): two 10% owners
- Total shares: around 1.5 million
- Price per share: $5.55 to $12.99
- Total cost: over $10.0 million
Denver-based ModivCare Inc. (NASDAQ: MODV) is a tech-focused healthcare services company. Since it posted its most recent quarterly results, its stock has retreated more than 63%. The share price hit an all-time low of $5.55 recently, but the consensus price target is up at $17.50. That indicates analysts currently anticipate around 146% upside in the next 12 months. Half of the six analysts covering the stock recommend buying shares, two of them with Strong Buy ratings. Note that one of these buyers, Q Global Capital Management, is a frequent acquirer of shares.
Cantor Equity Partners I
A beneficial owner is in at the IPO price.
- Buyer(s): 10% owner Cantor EP Holdings I
- Total shares: 500,000
- Price per share: $10.00
- Total cost: $5.0 million
This transaction was also a private placement of shares. Cantor Equity Partners I Inc. (NASDAQ: CEPO) is a New York-based special purpose acquisition company founded in November 2020. It had an initial public offering of 20 million shares at $10 apiece on January 7. The stock has a post-IPO trading range of just $10.04 and $10.07. The stock, of course, has no analyst coverage, and therefore no consensus price objective.
Zymeworks BC
Big expectations for this biotech.
- Buyer(s): 10% owner EcoR1 Capital
- Total shares: almost 392,800
- Price per share: $13.12 to $14.08
- Total cost: more than $5.2 million
Though some officers recently sold shares, this beneficial owner returned to the buy window to increase its stake in Zymeworks BC Inc. (NASDAQ: ZYME). The Delaware-based biopharmaceutical company, along with Jazz Pharmaceuticals PLC (NASDAQ: JAZZ), received an FDA nod for a cancer treatment candidate back in November. The share price has retreated almost 5% since then, though when last seen it was within the purchase price range above. Compared to a year ago, the stock is up over 22%, and analyst anticipate 49% or so further growth in the coming year to their $20.44 consensus price target. Of the eight analysts who cover the stock, six have a Buy or better rating.
Jeld-Wen
Showing some love ahead of a quarterly report.
- Buyer(s): 10% owner Coliseum Capital Management
- Total shares: 470,000
- Price per share: $7.49 to $8.61
- Total cost: nearly $3.7 million
Though Jeld-Wen Holding Inc. (NYSE: JELD) stock has outperformed the broader markets so far this year, it has bounced from a recent multiyear low. The share price was last seen above the purchase price range above, but it is still more than 51% lower than a year ago. The building products maker’s fourth-quarter report is due in a few weeks, and the third-quarter results fell short of expectations on the top and bottom lines. None of the 10 analysts who cover the stock recommend buying shares, yet their $11.10 consensus price target indicates they see about 18% upside in the next 12 months. Note that this buyer also acquired a million shares in early November.
And Other Insider Buying
Some smaller insider buys at Atlanta Braves, Bank of America, FedEx, and more.
In the past week, some insider buying was reported at Atlanta Braves, Bank of America, Curtiss-Wright, Designer Brands, FB Financial, FedEx, Greif, Lamb Weston, Mercury General, Mueller Water Products, Neogen, Opko Health, PBF Energy, and Staar Surgical as well.
Prediction: This EV Stock Will Be the Best Performer in 2025
Top Gaining Stocks
Top Losing Stocks