Market Overview

Hewlett-Packard, Yahoo! and Other Stocks Insiders Are Buying

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Insiders may sell shares for any number of reasons, but there is really only one reason insiders buy shares of a company -- they believe the stock price will move higher and they want to profit from it. Pullbacks and sell-offs provide a perfect opportunity for investors who have faith in a company to snap up shares. Here are some stocks that have seen insider buying recently.

CVR Energy (NYSE: CVI): Activist investor Carl Icahn recently purchased more than 1.6 million shares, worth over $45 million. This Sugar Land, Tex.-based fuel refiner became a subsidiary of Icahn Enterprises (NASDAQ: IEP) in May and is in the process of being sold. It has a market cap of $2.1 billion. Though the share price is down more than 8% in the past week, year to date it is more than 29% higher. Despite the recent drop in the share price, the stock has outperformed competitors such as HollyFrontier (NYSE: HFC), as well as the broader markets, over the past six months.

See also: CVR Energy Provides Update on Sale Process

Ferrellgas Partners (NYSE: FGP): Last week, the chief executive purchased more than 31,000 shares, worth more than $360,000. This was his fourth, and largest, purchase of shares this year. This propane distributor recently announced its 71st consecutive $0.50 quarterly distribution. The Overland Park, Kan.-based company has a dividend yield of 11.9%. Shares fell about 7% in the past month and are down more than 11% year to date. The stock has underperformed the likes of AmeriGas Partners (NYSE: APU) and Suburban Propane (NYSE: SPH) over the past six months.

Frontier Communications (NASDAQ: FTR): Some 50,000 shares, worth more than $177,000, were purchased last week by a director. The CEO, COO and others bought more than 150,000 shares in May. This telecom has a market cap of $3.5 billion. Short interest is about 23% of the float. Despite a slight rise in the past week, the share price has been falling for the past year and is now nearly 30% lower year to date. The stock has underperformed competitors such as AT&T (NYSE: T) and CenturyLink (NYSE: CTL), as well as the broader markets, over the past six months.

See also: Five Risky Dividend Stocks

Hewlett-Packard (NYSE: HPQ): A director for this Palo Alto, Calif.-based computer hardware maker bought up more than 13.1 million shares in the past two weeks. That was worth more than $295 million. The market cap of this S&P 500 component is $41.6 billion. An analyst downgrade on Friday sent shares lower by about 6%. The share price is now more than 17% lower than at the beginning of the year. Over the past six months, the stock's performance has been in line with that of rival Dell (NASDAQ: DELL) but it has underperformed International Business Machines (NYSE: IBM).

See also: Hewlett-Packard Brings in New Head of Software

Opko Health (NYSE: OPK): The chairman continues to periodically buy batches of shares, as he has done since last November. He bought 170,000 shares, worth more than $805,000, in the past week. This Miami-based health care company has a market cap of $1.3 billion. Short interest is 23.7% of the float. Shares have traded mostly between $4.50 and $5.50 since October, and the share price is more than 7% lower that at the beginning of the year. Over the past six months, the stock has underperformed competitors such as Allergan (NYSE: AGN) and the broader markets.

See also: Blueberries, Gold Bond, Ovaltine and Obesity: The Makings for a Very Good Story

Yahoo! (NASDAQ: YHOO): Three directors purchased more than 1.7 million shares of this Sunnyvale, Calif.-tech giant at the end of May. That was worth more than $26.4 million. Yahoo! recently ousted its CEO, and it has just released a Web browser. This S&P 500 component has a market cap of $18.3 billion and its long-term EPS growth forecast is 14.4%. Shares have traded mostly between $14.50 and $16.50 since October. The stock's performance has been largely in line with Google's (NASDAQ: GOOG) over the past six months, but it has underperformed AOL (NYSE: AOL).

See also: Is the Yahoo! and Facebook Battle About to End?

ACTION ITEMS:

Bullish: Investors interested in exchange traded funds focused on insider sentiment might want to consider the following trades:

  • Guggenheim Insider Sentiment (NYSE: NFO) is about 2% lower year to date.
  • Direxion All Cap Insider Sentiment Shares (NYSE: KNOW) is about 6% lower year to date.
Bearish:

Traders may prefer to consider these alternative positions to some of the stocks listed above:

  • AOL (NYSE: AOL) is up more than 81% year to date.
  • Cynosure (NASDAQ: CYNO) is up more than 62% year to date.
  • Equinix (NASDAQ: EQIX) is up more than 55% year to date.
  • Western Refining (NYSE: WNR) is up more than 36% year to date.
Neither Benzinga nor its staff recommend that you buy, sell, or hold any security. We do not offer investment advice, personalized or otherwise. Benzinga recommends that you conduct your own due diligence and consult a certified financial professional for personalized advice about your financial situation.

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