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CEOs Are Buying and Selling Shares of These Companies

Keeping tabs on insider trading behavior may be quite important for investors, because past research shows that insiders’ actions can offer an accurate reflection of the prospects for a company, industry or even a stock market in general. Intuitively, this makes perfect sense. After all, corporate insiders possess a broad set of skills and characteristics that could be used to describe the “value-oriented” type of investors.

Some of these skills and characteristics include: an extensive knowledge and understanding of their companies and industries; a tendency to employ the contrarian approach to investing; and a tendency to maintain a long term perspective. Hence, insider trading activity, especially insider buying, represents a strong source of information for long-term-oriented investors. As legendary investor Peter Lynch once said, corporate insiders may sell shares of their own companies for a variety of reasons such as estate planning or diversification benefits, but there is only one reason they buy – they think the price is going up. Insider Monkey identified a set of noteworthy insider transactions reported with the SEC on Wednesday, so this article will discuss notable insider trading recently witnessed at five U.S. publicly traded companies.

Through extensive research that covered the portfolios of several hundred large investors between 1999 and 2012, we determined that following the small-cap stocks that large money managers are collectively bullish on, can generate monthly returns nearly 1.0 percentage points above the market (see the details here).

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CEO of Struggling Cruise Operator Buys Sizable Amount of Shares

The most influential corporate insider at Norwegian Cruise Line Holdings Ltd (NASDAQ:NCLH) purchased two separate blocks of shares at the end of August. Frank J. Del Rio, President and Chief Executive Officer, purchased a block of 55,623 shares on Wednesday at prices varying from $35.75 to $36.34 per share, lifting his direct ownership holding to 451,171 shares. Mr. Del Rio also snapped up a new stake of 27,875 shares on the same day at a weighted average cost of $35.90 per share, a stake owned directly by FJDR Family Trust.

The global cruise company, which operates the Norwegian Cruise Line, Oceania Cruises and Regent Seven Seas Cruises brands, has lost 38% of its market capitalization since the beginning of the year. The aforementioned insider buying comes shortly after Norwegian Cruise Line Holdings Ltd (NASDAQ:NCLH) lowered its full-year earnings forecast to...


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