Bottom hunting: Corporate insider buying reaches two-year high
Here’s an encouraging sign for investors…. Corporate execs are buying stock in their companies at the highest rate since the start of COVID. After all, who knows the companies more than their own execs and employees?
According to VerityData (FT), insider buying at S&P 500 companies has been the strongest since March 2020.
- In May, over 1,100 execs at S&P 500 companies purchased stock in their companies.
- Howard Schultz purchased $15M of Starbucks shares — which is down 35% this year — becoming the first insider to buy since August 2018.
Signals of a bottom: A jump in the insider buy-to-sell ratios occurred near past market bottoms (2015, 2018 and 2020).
- Within the tech and communications sectors, the insider buy-to-sell ratios are at the highest since 2012, per JPMorgan (FT).
- Chief Equity Strategist at The Private Bank, Todd Lowenstein, isn’t surprised at the level of buying — and says “there is some good value emerging right now” (MW).
Companies with the most insider buying: In David Stevenson’s Adventurous Investor Newsletter, Stevenson pulled a list of companies with the highest insider buying in the past 30 days.
- Occidental Petroleum Corp (NYSE:OXY), Kyndryl Holdings (NYSE:KD), iHeartMedia (NASDAQ:IHRT), Appian (NASDAQ:APPN) and Coinbase (NASDAQ:COIN).