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Insider Buys at 52-Week Lows

December 30, 2013 | About:
Monica Wolfe

Monica Wolfe

133 followers

Over the past week three companies have reported multiple insider buys as their price hits or nears 52-week lows. Looking at insider buys while they’re trading at low prices can offer an excellent time to buy into a company or further your research on the company. Peter Lynch once offered that insiders will sell their shares in a company for many reasons, but they will only invest it if they think that the share price will rise.

The following three companies are trading at or within 5% of their 52-week low share price and reported insider buys over the past week.

Nuveen Diversified Commodity Fund (CFD)

Over the past week there were two insiders making buys into Nuveen Diversified Commodity Fund.  These insiders are Vice President William Adams and Independent Committee Member Harry Short, and they made their buys as the price has fallen to a record low.

Vice President William Adams added the most, purchasing 18,500 shares of the company’s stock.  He bought these shares at $15.24 per share for a total transaction amount of $281,940.  The VP now holds on to at least 18,500 shares of the company’s stock.  Since his buy the price per share has dropped an additional -0.59%. 

Harry Short added a much smaller 1,600 shares to his holdings on Dec. 23.  These shares were purchased for $15.19 per share for a total transaction amount of $24,304.  Since his buy the price per share is down an additional -0.26%.

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Nuveen Diversified Commodity Fund is a commodity pool. It invests directly in a portfolio of commodity futures and forward contracts in the commodity markets.

Nuveen’s historical revenue and net income:

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The company was recently named as “Best Fund” among its peers by the 2013 Lipper Individual Fund Awards.  It received this award for delivering “consistently strong, risk-adjusted performance.”  The individual funds receiving awards under the Nuveen brand consisted of fifteen separate funds listed here.

The analysis on Nuveen reports that the company’s revenue has been in decline over the past years, its Altman Z-Score is strong and the company holds no debt.  The analysis also notes that the company’s price is close to a 5-year low and the P/S ratio is near a 2-year high.

Nuveen Diversified Commodity Fund has a market cap of $138.3 million.  Its shares are currently trading at around $15.05 with a P/B ratio of 0.80.  The company currently holds a dividend yield of 10.20%.

Full Circle Capital Corp (FULL)

Over the past week there were two insiders making four buys into Full Circle Capital.  These buys come as the company’s price has hit its lowest price since Nov. 2011.

Co-CEO and President added a total of 8,091 shares to his stake at an average cost of $7.16 per share.  The CEO’s two transactions cost him a total of $57,782. The price has dropped approximately -1.675% since then. He now holds on to at least 18,396 shares of the company’s stock.

Chairman and Co-CEO John Stuart also made two insider buys over the past week.  This CEO added a total of 3,000 shares at approximately $7.21 per share. These buys cost Stuart a total of $21,620.  Since his buys the price per share has dropped approximately 2.36%.

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Full Circle Capital is an externally managed non-diversified closed-end management investment company that intends to elect to be treated as a business development company. The company was formed to continue and expand the business of Full Circle Partners LP and Full Circle Fund Ltd.

Full Circle’s historical revenue and net income:

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The company recently announced its Q1 2014 earnings which reported:

  • Expanded revolving line of credit to $45 million.
  • Net asset value of $7.48 per share.
  • Total investment income was up 14.9% to $3.2 million.
  • Net investment income was $1.2 million, or $0.16 per share.

The analysis on Full Circle reports that over the past three years the company has issued $25.05 million in debt, its dividend yield is at a 3-year high and its price is near a 5-year low.  The analysis also notes that the company’s P/B and P/S ratios are near historic lows and that the company’s sales outstanding has increased, meaning that it might be having difficulty collecting payment from its customers.

The Peter Lynch Chart suggests that the company is currently overvalued:

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Full Circle Capital has a market cap of $53.2 million.  Its shares are currently trading at around $7.04 with a P/E ratio of 82.90, a P/S ratio of 4.90 and a P/B ratio of 0.90.  The dividend yield for Full Circle stocks is currently at 13.10%.

Keating Capital (KIPO)

Over the past week there were four insiders making buys into Keating Capital as the company’s price is sitting near its 52-week low and as the company made a secondary public offering of its stocks.  The insiders making buys during this public offering of common stock were CEO and President Timothy Keating, Director Taylor Simonton, Chief Investment Officer Kyle Rogers and CFO, COO, CCO and Treasurer Frederic Schweiger.

These four insiders made their buys during the public offering for $6 per share, and since their buys the price per share is down about -0.83%.  Highlighted below are the insiders’ individual buys:

  • Timothy Keating (CEO):  Bought 8,000 shares for $48,000.  Now holds 98,000 shares of KIPO stock.
  • Taylor Simonton (D):  Bought 3,000 shares for $18,000. Now holds 13,000 shares of KIPO stock.
  • Kyle Rogers (CIO):  Bought 3,072 shares for $18,432.  Now holds 8,096 shares of company stock.
  • Frederic Schweiger (CFO/COO):  Bought 8,000 shares for $48,000.  Now holds on to 26,700 shares of KIPO stock.

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Keating Capital is a closed-end, non-diversified investment company that has elected to be regulated as a business development company.  The company invests in innovative, high growth private companies that are committed to and capable of becoming public.

Keating Capital’s historical revenue and net income:

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The analysis on Keating reports that the company’s Altman Z-Score is strong, the company holds no debt and its price is near a 3-year low. 

As a result of its recent public offering the company expects that they will issue an additional 713,562 shares of the company’s stock.  The net proceeds of this will be used to make new portfolio company investments.

The company also recently announced a special dividend of $0.0109 per share.  This dividend marks the third special dividend for the year and marks the distribution of the $4.4 million in net gains the company has received in 2013.

Keating Capital has a market cap of $52.6 million.  Its shares are currently trading at around $5.95 with a P/B ratio of 0.80.  The company’s dividend yield is currently at 0.50%.

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