Executives are buying stock in droves, giving a 'strong' signal that the comeback is for real
The ratio of companies with insider buying compared to insider selling is at 1.75 for March, its highest level since March of 2009, according to Washington Service.Wells Fargo are purchasing shares while outsiders ditch riskier assets, sucking trillions in value from the U.S. stock market in recent weeks. The ratio of companies with insider buying compared to insider selling is at 1.75 for March, its highest level since March of 2009, according to Washington Service, a provider of insider-trading and data analytics. Typically, that ratio is below 1, meaning more executives are selling stocks; however, the current positive ratio is a sign of corporate optimism and is bullish for equities and the future of the economy. Insider buying activity provides "insight into which company insiders believe they have the liquidity to withstand a 1-2 month massive decline in economic activity and the solvency to withstand a 'go forward' economy that is less robust than the one left behind," Raymond James analyst Tavis McCourt said in a note to clients. The broader market has experienced a dismal rout in recent weeks caused by the financial and societal disruption from the fast-spreading coronavirus. All three majors averages plunged into a bear market at the fastest rate of all time this month. Positive sign for comeback But extraordinary monetary and fiscal stimulus measures have put a floor under the market this week and the Dow Jones Industrial average is currently experiencing its best three-day rally since the 1930s. The bounce comes as C-suit employees are loading up. "Insiders have a 35+ year track record of buying on the type of extreme weakness experienced in Q1'20," InsiderScore director of research Ben Silverman said in a note. "A dramatic increase in insider buying volume combined with dampened levels of insider selling has resulted in the generation of industry buy inflections – our strongest, quantitative macro signal – for the entire market." Dell Technologies, the maker of PC computers, founder and CEO Michael Dell bought more than 800,000 shares worth $26.3 million last week, according to the Washington Service tracker. Shares of Dell are down about 40% from its recent high, which indicates Dell is expecting the stock to shoot up. Insiders likely wouldn't be buying stock if they weren't expecting healthy business on the other side of the virus turmoil, but they are long term shareholders. Raymond James said Dell is experiencing a pick-up in laptop orders due to the work-from-home trend. Wells Fargo CEO Charles Scharf bought about $5 million worth of stock and Planet Fitness chief Rondeau Christopher purchased about $4 million in stock earlier this month. Both stocks have lost about 40% of their values since the February highs. "Insider sentiment turned positive during the February 24 market sell-off and has built since then. Friday, March 13 proved to be an important day as an Industry Buy Inflection generated within the S&P 500," Silverman noted. Private equity firm stakeholders are also in a phase of buying, data show. Abdiel Capital, which owns more than 10% of Read more: CNBC
It’s very difficult for executives to trade their own stock. They have long lockout periods before and after earnings and when they have material information. Typically, they’re set up on automated trading that is predetermined. I call BS on this. Cause they know that bailout money is otw n also buy back at a much lower price it’s a cycle
Translation: CNBC authors want to inflate prices and dump stocks. Everyone wants to purchase shares these days... Nice soundbite to ramp the market but in your words “ dampened levels of insider selling” affect that ratio. Suckers rally. The next correction down after month end. Airlines did that and now they're feeling it, wanting bailouts for being greedy and buying too high
lol, don't get burned like did in 2008 Executives buying stocks is not a sign of a recovery only a sign of opportunity and greed It helps, but they don't have a crystal ball. That’s bullshit. The rich will get get richer, and the rest of us will die. BS
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Social capitalism! I think I want to hear from the companies themselves during earnings next month before I buy anything. My guess is that this has a long way to go. Translation: they bought a few days ago, they want to you buy the shares they are dumping soon carlossosafrias Dump.exe The CEO profits heavily off of corporate buybacks. Who is now buying back stock, which is essentially the company buying back the stock. Is this the loophole moving forward?
Wait until intel, Dell and the others need the silicon to produce semiconductors. They will be beholden to the Chinese who may hold this mined resource over their heads. Then I imagine the “free market” will demand our Fed. Gov. to step in and help them out. Idiots... Not true (as per medical records.)
GetBack2Work Peasants EasterIsComing Keep telling yourself that CNBC, just trying to find buyers for your shorts
Old Navy Has 50% Off Everything Until March 26 -- Here Are 10 Things Under $25Prices are so low in this 50% off sale at Old Navy you'll want to stock up on everything from loungewear to jackets for everyone in the family.
They must all know something we don't know.... Thats because there's no more gold for them to buy. There isnt much else for them to do with their money at this point. Stocks are a bargain now, but further patience will be rewarded. this is actually a good sign for another downtown; both co buybacks & exec buying are 'generally' done at the wrong times - we'll see. but even at monday lows, 'mkt' still overvalued, just not as much as 2/19 - of course, that fact will be disputed
Must prop up market per secret Bailout orders from Trump. This is very good. Let’s keep the capital markets strong. Hey , what do you think of companies buying shares for employees instead of the traditional buyback model?
Keeping Up With All the Celeb Livestreams: What to Watch on March 24Kourtney Kardashian, Miley Cyrus and more of your favorite celebrities are serving up entertainment, optimism and information in light of social distancing. Get all the details here.
BOJ braced for deeper economic trouble even after March easing: summaryThe coronavirus pandemic could plunge Japan into prolonged economic gloom, Bank ... . There is no longer any monetary policy that the BOJ can play on the real economy. What exists is the purchase of stocks into the market driven under Abenomics. Nobody knows when the BOJ will sell the stock it has purchased to maintain its stock price.
March 24 coronavirus news - CNNBack to work by Easter tho. We broke 500 Yesterday morning Today 775 open CNN news, I close my eyes,and I know it blames president trump. When trump closed the broad of the USA,cnn said he was crazy.but now,cnn says trump is too later to prevent the virus spread! How ridiculous!
March PMIs presage a precipitous recession in America and EuropeServices were hit early and hard in March, as travel, tourism and visits to restaurants dried up I wonder why? Dude the economist is onto something.....