CEOs love buying stock with your money, not own

Published Mon, May 18 201511:35 AM EDT

As CEOs buy a record amount of stock with shareholder money, they are keeping their wallets in their pockets when it comes to purchasing shares with their own cash. In the last six weeks, U.S. companies made buyback announcements that came to $5.7 billion a day, according to TrimTabs Investment Research. Yet in the month of April executives at those same companies bought only $240 million worth of stock with their own money, the lowest level of insider buying in more than two years. "Insider buying virtually dried up in April, sending the insider sell/buy ratio to its highest level in more than two years," noted the TrimTabs report. It's a troubling contrast that may speak to the true feelings executives have about the staying power of this six-year bull market. "Given the rich valuations of U.S. equities, the heavy share selling by companies and the weakness of buying by insiders is not too surprising," said the TrimTabs report to clients Sunday. Last week, four companies announced buybacks greater than around $5 billion, according th the research firm. They were American Express , Biogen , Delta Air Lines and LyondellBasell . There's another trend that speaks to the short-term view of executives. Buybacks this year by S & P 500 companies will jump 18 percent to a record $600 billion, predicts Goldman Sachs, but cash dividends—a longer-term vote of confidence—will climb just 7 percent to $400 billion, according to the firm. Goldman also cites high valuations as the reason for this dichotomy. It notes that the median price-earnings ratio of stocks in the S & P 500 is above 18, the 99th percentile of history. Read More Value investor: Buy this food stock The money play: So Goldman, in a note Friday, told clients to focus on the companies making that long-term leap of faith by lifting dividends. (Buyback announcements are promises, but a dividend is more of a contract.) The firm recommened stocks in its "Dividend Growth Basket" like Ford , Coca-Cola Enterprises , National Oilwell Varco , Pfizer , Lockheed Martin , Microsoft and Verizon . —With reporting by CNBC's Michael Bloom .

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As CEOs buy a record amount of stock with shareholder money, they are keeping their wallets in their pockets when it comes to purchasing shares with their own cash.

In the last six weeks, U.S. companies made buyback announcements that came to $5.7 billion a day, according to TrimTabs Investment Research.

Yet in the month of April executives at those same companies bought only $240 million worth of stock with their own money, the lowest level of insider buying in more than two years. "Insider buying virtually dried up in April, sending the insider sell/buy ratio to its highest level in more than two years," noted the TrimTabs report.

It's a troubling contrast that may speak to the true feelings executives have about the staying power of this six-year bull market.