5 Stocks Insiders Love Right Now
VeriFone Systems
4. Verifone Systems
Another stock that insiders are finding attractive here is business equipment player VeriFone Systems, which is engaged in the secure electronic payment solutions.
It provides solutions, and services for the financial, retail, hospitality, petroleum, transportation, government, and health-care vertical markets. Insiders are finding some deep value here, since this stock is down by over 33 percent in the last three months.
VeriFone has a market cap of $3.84 billion and an enterprise value of $5.13 billion. This stock trades at a reasonable valuation, with a trailing price-to-earnings of 16.7 and a forward price-to-earnings of 10.96.
Its estimated growth rate for this year is 38.5 percent, and for next year it's pegged at 22.2 percent. This is not a cash-rich company, since the total cash position on its balance sheet is $366.40 million, and its total debt is a whopping $1.61 billion.
The CEO just bought 155,000 shares, or around $5.03 million worth of stock, at $32.50 per share.
From a technical perspective, VeriFone is currently trading below both its 50-day and 200-day moving averages, which is bearish. This stock got hammered back in April, with shares plunging from a high of $55.89 to a recent low of $30.10 a share.
During that massive drop, shares of VeriFone were constantly making lower highs and lower lows, which is bearish technical price action. The stock also flashed a number of warning signs to longs with large gap downs on heavy volume.
That said, the stock has started to find some buying interest near $30 to $32 a share, and it’s now making higher lows and higher highs.
If you’re in the bull camp on VeriFone, I would look for long-biased trades if this stock can manage to trigger a near-term breakout trade above some overhead resistance levels at $36.78 to its 50-day moving average of $36.81 a share with high volume.
Look for volume on that move that hits near or above its three-month average volume of 3.6 million shares. If we get that breakout soon, then VeriFone could start to fill a recent gap down that started near $44 a share.
Some key levels to watch for are $40 a share which is near the low of the gap down day, and its 200-day moving average of $42.25 a share. If those levels get taken out with volume, then VeriFone could re-visit some more resistance at $47.82 a share.
On the flipside, I would avoid VeriFone or look for short-biased trades if it fails to trigger that breakout soon, and then drops below some major near-term support at $34 a share with heavy volume.
If we get that action, then VeriFone could head back towards $32 to $30 a share. Any future move below its 52-week low of $30.10 a share should be consider bearish price action, since most stocks that print new 52-week lows continue to do so for some time.
Hudson Global
5. Hudson Global
Another stock with some interesting insider buying is Hudson Global, which provides specialized professional-level recruitment and related talent solutions worldwide.
Insiders are buying this stock into some notable weakness, since shares are off by around 18 percent so far in 2012.
Hudson Global has a market cap of $143 million and an enterprise value of $113.14 million.
This stock trades at a reasonable valuation, with a trailing price-to-earnings of 18.71 and a forward price-to-earnings of 12.83.
Its estimated growth rate for this year is -147.1 percent, and for next year it’s pegged at 318.8 percent. This is a cash-rich company, since the total cash position on its balance sheet is $24.93 million and its total debt is $1.04 million.
A beneficial owner just bought 112,400 shares, or about $443,000 worth of stock, at $3.95 per share. The same beneficial owner also just bought 150,000 shares, or about $605,000 worth of stock, at $4.03 per share.
From a technical perspective, Hudson is currently trading above its 50-day moving average and below its 200-day moving averages which is neutral trendwise.
This stock took a dive off its April high of $5.98 to its recent low of $3.23 a share. During that large move lower, shares of Hudson were consistently making lower highs and lower lows, which is bearish technical price action.
That said, the stock formed a double bottom in mid-June at around $3.23 to $3.30 a share. Since marking that bottom, shares of Hudson have soared back above its 50-day moving average of $3.96 a share.
If you’re bullish on Hudson, then I would look for long-biased trades once this stock takes out its 200-day moving average of $4.61 a share with high volume.
Look for volume on that move that registers near or above its three-month average action of 107,522 shares.
If we get that move soon, then look for Hudson to trade back towards its next significant overhead resistance levels at $5.72 to $5.98 a share. It’s possible that Hudson could pull back to its 50-day at $3.96 a share before it challenges its 200-day.
I would simply avoid Hudson if it fails to trigger that breakout, and then moves back below its 50-day moving average at $3.96 and some more near-term support at $3.78 a share with heavy volume.
If we get that move, then Hudson could easily re-test its previous double bottom price levels at $3.30 to $3.32 a share. Any move below its 52-week low of $3.05 share should be considered bearish technical price action.
—By TheStreet.com Contributor Roberto Pedone
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Disclosures:
TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks. At the time of publication, Roberto Pedone had no positions in stocks mentioned.
