Big Insider Purchases by Carl Icahn, Mario Gabelli, and Others

In the past week or so, beneficial owners Carl Icahn and Mario Gabelli made some big bets in Monro Inc. (NASDAQ: MNRO) and Gabelli Healthcare & WellnessRx Trust (NYSE: GRX), respectively. Meanwhile, another 10% owner boosted a stake in Benitec Biopharma Inc. (NASDAQ: BNTC) via a direct offering. These were the most prominent insider purchases in that time, but there were several other notable ones as well.

While insider buying is typically slower when markets are near all-time highs and when earnings-reporting season is in full swing, it never seems to dry up altogether. These recent notable purchases attest to this. Let’s take a quick look at these notable transactions and others.

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.

With the third-quarter earnings-reporting season still underway, many insiders are prohibited from buying or selling shares. Below are some of the most notable insider purchases that were reported recently, starting with the largest and most prominent.

Monro

• Buyer(s): 10% owner Carl Icahn
• Total shares: almost 1.3 million
• Price per share: $15.19 to $17.48
• Total cost: more than $20.8 million

Shares of Monro retreated after it recently posted mixed quarterly results. Billionaire investor Icahn jumped in a made a big bet on the automotive repair and tire services provider, boosting his stake to more than $5 million shares.

The share price has been trending downward for the past five years and hit a multiyear low of $12.20 earlier this year. The stock has recovered from its post-earnings pullback and was last seen trading above Icahn’s purchase price range. Analysts see little to no upside potential in the next 12 months, given that the consensus price target is about the same as the current price. Only one of five analysts who cover the stock recommends buying shares.

Note that Icahn sold 1.5 million shares of Southwest Gas Holdings Inc. (NYSE: SWX | SWX Price Prediction) back in September.

Benitec Biopharma

• Buyer(s): 10% owner Suvretta Capital Management
• Total shares: less than 1.5 million
• Price per share: $13.50
• Total cost: nearly $20.0 million

This transaction was a direct offering of Benitec Biopharma shares intended to fund the continued development of its product candidate programs, working capital, and other general corporate purposes. This clinical-stage, gene therapy-focused, biotechnology company develops novel genetic medicines based on its proprietary platform.

The share price is around 24% higher than a year ago, despite pulling back over 12% in the past month. Analysts anticipate upside potential of about 95% in the next 52 weeks to their mean price target of $25.86. All eight analysts who cover the stock recommend buying shares, three of them with Strong Buy ratings. H.C. Wainwright sees the share price going to $35, the street-high target.

Note that this buyer, a hedge fund with a focus on the health care and technology sectors, has raised its stake to more than 9.5 million shares.

Gabelli Healthcare & WellnessRx Trust

• Buyer(s): 10% owner Mario Gabelli
• Total shares: 1.8 million
• Price per share: about $10.18
• Total cost: more than $18.3 million

Gabelli Healthcare & WellnessRx Trust is a closed-ended equity mutual fund launched by GAMCO Investors. This buyer also recently purchased shares of Gabelli Multimedia Trust Inc. (NYSE: GGT) and Gabelli Global Small and Mid Cap Value Trust (NYSE: GGZ). And he acquired shares of Atlanta Braves (see below) earlier this year.

The share price is almost 12% lower than a year ago, underperforming the S&P 500 and also somewhat lower than the purchase price above. There is no analyst coverage and therefore no consensus price target. The all-time high is above $13.

Note that renowned value investor Mario Gabelli is the founder and CEO of GAMCO Investors.

And Other Insider Buying

These were not the only notable insider purchases of the past week or so. Here’s a quick look at some others.

Recently, some smaller insider buying was reported at American Tower, Atlassian, Caterpillar, Cheniere Energy, ConocoPhillips, Enphase Energy, Global Payments, Illumina, JetBlue Airways, Lattice Semiconductor, Matador Resources, Molson Coors Beverage, Norwegian Cruise Line, Norfolk Southern, Northern Trust, Omega Healthcare Investors, PG&E, RXO, Utz Brands, and Waste Management as well.

Insiders Are Scooping Up Shares of a Miner, a Driller, and a Biotech