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5 Industrial Companies Insiders Are Fortifying

Stocks with high insider cluster buys as GDP growth accelerates to end 2021

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Jan 27, 2022
Summary
  • Fourth-quarter GDP growth surpassed estimates despite lingering pandemic.
  • GuruFocus listed several industrial companies with high insider cluster buys.
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According to the Insider Cluster Buys page, a Premium feature of GuruFocus, industrial companies with high insider cluster buys over the past three months include ARC Document Solutions Inc. (

ARC, Financial), Atlas Technical Consultants Inc. (ATCX, Financial), Infrastructure and Energy Alternatives Inc. (IEA, Financial), Griffon Corp. (GFF, Financial) and Quest Resource Holding Corp. (QRHC, Financial).

On Thursday, the U.S. Bureau of Economic Analysis reported that real gross domestic product increased at an annual rate of 6.9% during the fourth quarter of 2021, surpassing the Dow Jones estimate of 5.5% growth. During the third quarter, GDP increased by 2.3%.

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The strong growth in GDP reflects increases in private inventory investments and personal consumption expenditures despite the ongoing risks associated with the Covid-19 pandemic. The increase in exports reflected growth in consumer goods, food, beverages and industrial supplies and materials.

As such, investors can find opportunities in industrial companies that have a high number of insider cluster buys over the past three months. According to legendary Fidelity Magellan fund manager Peter Lynch, insiders buy shares only when they believe the company stock is due to appreciate in value.

ARC Document Solutions

Nine insiders purchased shares of ARC Document Solutions (

ARC, Financial) during the past three months. The total number of shares purchased was 385,962.

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Shares of ARC Document Solutions traded around $3.29, showing the stock is significantly overvalued based on Thursday’s price-to-GF Value ratio of 2.46.

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GuruFocus ranks the Walnut Creek, California-based document solutions company’s financial strength 5 out of 10 on the back of interest coverage and debt ratios underperforming more than 70% of global competitors despite the company having a high Piotroski F-score of 7.

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Gurus with holdings in ARC Document Solutions include

Jim Simons (Trades, Portfolio)’ Renaissance Technologies and David Nierenberg (Trades, Portfolio)’s D3 Family of Funds.

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Atlas Technical Consultants

Eight insiders purchased shares of Atlas Technical Consultants (

ATCX, Financial) over the past three months. The total number of shares purchased was 58,763.

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GuruFocus ranks the Austin, Texas-based construction company’s financial strength 2 out of 10 on several warning signs, which include interest coverage and debt ratios that are underperforming more than 85% of global competitors.

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Infrastructure and Energy Alternatives

Six insiders purchased shares of Infrastructure and Energy Alternatives (

IEA, Financial) during the past three months. The total number of shares purchased was 23,068.

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Shares of Infrastructure and Energy Alternatives traded around $7.84, showing the stock is modestly undervalued based on Thursday’s price-to-GF Value ratio of 0.85.

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GuruFocus ranks the Indianapolis-based construction company’s financial strength 4 out of 10 on the back of a low Piotroski F-score of 3, a weak Altman Z-score of 1.88 and interest coverage ratios that underperform more than 88% of global competitors.

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Gurus with holdings in Infrastructure and Energy Alternatives include

Steven Cohen (Trades, Portfolio)’s Point72 Asset Management and Chuck Royce (Trades, Portfolio)’s Royce Investment Partners.

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Griffon

Six insiders purchased shares of Griffon (

GFF, Financial) over the past three months. The total number of shares purchased was 18,822.

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Shares of Griffon traded around $21.71, showing the stock is modestly overvalued based on Thursday’s price-to-GF Value ratio of 1.18.

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GuruFocus ranks the New York-based industrial products company’s profitability 7 out of 10 on the back of a three-star business predictability rank, a solid Piotroski F-score of 6 and a return on equity that outperforms over 60% of global competitors.

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Quest Resource Holding

Five insiders purchased shares of Quest Resource Holding (

QRHC, Financial) during the past three months. The total number of shares purchased was 1,055,200.

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Shares of Quest Resource Holding traded around $5.98, showing the stock is significantly overvalued based on Thursday’s price-to-GF Value ratio of 2.39.

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GuruFocus ranks the Texas-based waste management company’s financial strength 6 out of 10 on the back of debt ratios outperforming more than 67% of global competitors despite interest coverage ratios underperforming over 85% of global waste management companies.

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  • CEO Buys, CFO Buys: Stocks that are bought by their CEO/CFOs.
  • Insider Cluster Buys: Stocks that multiple company officers and directors have bought.
  • Double Buys:: Companies that both Gurus and Insiders are buying
  • Triple Buys: Companies that both Gurus and Insiders are buying, and Company is buying back.

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Disclosures

I/we have no positions in any stocks mentioned, and have no plans to buy any new positions in the stocks mentioned within the next 72 hours. Click for the complete disclosure
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