Weekly Update: Why We’re Buying More and Following the Insiders
Welcome back to another Insider Edge Weekly Update.
Each and every Tuesday, we will be providing an update on the stocks that are being bought and owned by company insiders that are set up for big gains over the coming days and weeks.
December brought a great rally to the stock market as well as for plenty of our company insider-bought stocks.
And January is setting up for new opportunities for not just our ongoing portfolio holdings but also a bevy of new stock opportunities that we just presented to you as the year was wrapping up and we were all getting ready to trade for this month.
So, we have a big collection of insider-identified opportunities for you to buy into as we follow company insiders for more profits.
Now, if you ever wonder how I track down company insider buys and the stocks to buy, watch my on-demand instructional video session on the Insider Edge website right here.
Insider Round-Up
Here is the current collection of buys for Insider Edge. For the full rundown on these and the rest of the trades, check out our Write-Ups here and our Trade Alerts Tracker here.
Peloton
Peloton (PTON) was one of the best performers of 2020 thanks to millions of people being forced to stay home during the pandemic.
Shares rose over 800% before peaking last January.
However, slowing growth and a return to work kneecapped the stock, and PTON fell 79% from its highs.
A 10% owner, operating under a limited partnership formed solely to purchase Peloton stock, bought $100 million of PTON shares last month at a price of $46 each – 25% above where the stock is now trading.
This means investors can buy in at an even lower price today.
The trade was initiated at $34.74, and with the current price at $32.97, we have a loss so far from the trade amounting to 5.09%
Per the Trade Tracker, PTON remains a buy with an end-of-day closing stop at $29.00.
Altice USA
Altice USA (ATUS) is a provider of broadband, television and phone services serving the northeastern United States.
Despite slow and steady growth to sales and earnings, shares are 58% off their highs in 2021.
So far, ATUS is finding double bottom support near the $14 area.
There have been five insider buys in the last six weeks by company directors totaling $1,610,800.
A new wave of value buyers could propel the stock up quickly. Even a return to its value-weighted average price over the last 52 weeks would mean 66% upside from where it trades today.
The trade was initiated at $16.07, and with the current price at $17.11, we have a gain so far from the trade amounting to 6.34%.
Per the Trade Tracker, ATUS remains a buy with an end-of-day closing stop at $14.00.
Everbridge
Everbridge (EVBG) is an enterprise software firm developing safety applications for critical event management.
EVBG stock had a fairly uneventful year in 2021 until three weeks ago when the company’s CEO resigned unexpectedly.
This triggered downgrades by several analysts, and shares fell 49% in a single day.
This appears to be an overreaction by Wall Street. And insiders are taking advantage…
Four company directors piled in the stock following the news.
Not only is this a cluster buy, but these are also the first insider buys by anyone in the history of Everbridge stock.
The firm went public in 2016, and this is the first time anyone on the inside has bought a single share.
That alone is enough to entice one to piggyback their trades and take a position in EVBG stock.
The trade was initiated at $65.66, and with the current price at $63.45, we have a loss so far from the trade amounting to 3.37%.
Per the Trade Tracker, EVBG remains a buy with an end-of-day closing stop at $57.00.
Purple Innovation
Purple Innovation (PRPL) is a young mattress manufacturer that took the industry by storm with its innovative foam design.
I may be biased toward this stock since I sleep on a Purple mattress every night. I am a fan of their product, and throughout 2020 so were investors.
Shares soared 766% from March 2020 to early 2021.
But the past year has been less kind to PRPL shareholders.
The stock fell 78.4% from its highs before bottoming around $9 per share.
However, a turnaround appears to be underway…
Shares were up 57% in recent trading. Part of this surge has come from 10% owner, Coliseum Capital, gobbling up a $90 million position during this period.
This could be just the start of heavy buying from value funds that propels shares even higher into 2022.
The trade was initiated at $13.54, and with the current price at $12.79, we have a loss so far from the trade amounting to 5.54%.
Per the Trade Tracker, PRPL remains a buy with an end-of-day closing stop at $11.00.
DocuSign
DocuSign (DOCU) is another hedge fund favorite of 2020 that sold off heavily in 2021.
A small earnings miss at the beginning of this month triggered heavy selling as shares fell 43% on the day.
But value buyers appeared to step in immediately.
You’ll notice huge buying volume on the right side of the chart as opportunistic investors supported the stock after it sold off.
The company’s top insider, CEO Daniel Springer, is also buying the dip in a big way.
He invested $5 million in the stock on Dec. 8 in what appears to be the first insider purchase by anyone in DocuSign’s history as a public company.
Given how close DOCU trades to its recent lows, investors only need to risk about 14% to see if shares rally from here. If the stock makes new lows, we want to exit the position.
The trade was initiated at $152.17, and with the current price at $150.44, we have a loss so far from the trade amounting to 1.14%.
Per the Trade Tracker, DOCU remains a buy with an end-of-day closing stop at $131.00.
Asana Inc.
Asana Inc. (ASAN) is a leading software company with a cutting-edge work management platform for collaborative work and sharing projects.
Asana helps plan marketing campaigns, streamlines processes, manages sales and even provides project management and workflow solutions.
The company founder and CEO is no slouch. At age 27, Dustin Moskovitz was reported to be the youngest self-made billionaire in history by Forbes.
He dropped out of Harvard in 2004 to co-found Facebook with Mark Zuckerberg. But in 2008, he left to start Asana.
In total, CEO Dustin Moskovitz has invested $232,655,300 in ASAN stock in the last 30 days.
That’s almost a quarter of a billion dollars. He went on a similar buying spree back in June.
On the fundamental side, Asana is showing tremendous growth. While the company is not yet profitable, sales increased by 57%, 61%, 72% and 70% in each of the last four quarters, respectively.
Yet, as of today, the stock is down by 53% off the highs it made last month. But the price is up by 3.07% from mid-December today, so this could be the beginning of a big recovery move.
A return to previous highs would deliver a double for anyone buying today.
The trade was initiated at $76.97, and with the current price at $66.55, we have a loss so far amounting to 13.54%.
Per the Trade Tracker, ASAN is a buy with an end-of-day closing stop at $61.00.
Victory Capital Holdings, Inc.
Victory Capital Holdings, Inc. (VCTR) is an investment management firm based in San Antonio, Texas. The company offers more than 60 mutual funds across various asset classes, representing $162 billion in assets under management.
After a decade-long bull market, asset managers are raking in record profits. VCTR stock is up 49% for the trailing year, outperforming the S&P 500 index by a nice margin.
As we know, insiders have an impeccable track record of buying lows before large moves higher. But the Victory Capital insiders are seasoned investment professionals, which could prove them to be even better market timers.
Three insiders just made large buys of VCTR stock. The Chairman and CEO, President/CFO and a board member recently invested a combined $1.77 million. These are the first purchases by anyone at the company in over a year.
The last time insiders at Victory bought the stock was right after the 2020 COVID lows. They are currently up between 120% and 151%. Additionally, these trades are of even larger size than the well-timed purchases made last Summer.
Chief Executive Officer David Brown is buying for the first time since 2018. Director Richard DeMartini and CFO Michael Policarpo are both first-time buyers.
Some weeks ago, VCTR stock took a dive following the announcement of a secondary stock offering. Secondary offerings dilute current shareholders, so these are sometimes viewed negatively by the market.
The offering raised $136 million, which combined with a $505 million term loan will be used to fund its acquisition of WestEnd Advisors.
Regardless of the market’s reaction to these developments, insiders are clearly bullish on Victory Capital’s future. They are using the opportunity to buy the dip and take a position at today’s discounted prices.
The trade was initiated at $34.54, and with the current price at $36.56, we have a gain so far amounting to 5.85%.
Per the Trade Tracker, VCTR is a buy with an end-of-day closing stop at $31.00.
Evergy, Inc.
Evergy, Inc. (EVRG) is the Kansas City, Missouri-based power utility that has been increasing its green and renewable energy portfolio, particularly with wind turbines that capitalize on midwestern wind flows for more power.
Recently, several top insiders began buying large chunks of the stock in their personal accounts. Combined, they have invested more than $12 million in the stock.
And as we discussed in past updates, one of the company’s board members filed reports of four separate buys last month alone.
The CEO and CFO seem to buy in tandem. They are both buying shares for only the second time. Their first purchases came this March when they bought the stock right off its low before a 30% advance higher.
Director John Wilder started buying a month later, and he has made four additional buys over the last few weeks.
EVRG stock does not see routine insider buying, making the recent cluster buy even more significant. I suggest following the lead of those on the inside and taking a position in Evergy.
The trade was initiated at $63.56, and with the current price at $68.56, we have a gain so far from the trade amounting to 5.00%.
Per the Trade Tracker, EVRG remains a buy with an end-of-day closing stop at $57.00.
Thanks for reading. I’ll be back in touch next Tuesday with another Weekly Update.
Best wishes for your trading,
Ross Givens
Editor, Insider Edge
