Written by Alexander Crawford
Wish you could get the inside scoop on your favorite companies? One way to get an inside peek is by looking at insider stock buying trends.
Company insiders, such as members of the board and upper management, report when they buy shares of company stock. When insiders at a company are buying more shares than selling, analysts take notice because who knows the prospects of their company better than they do?
To illustrate this, we ran a screen on dividend stocks of the S&P 500, paying dividend yields above 1% and sustainable payout ratios below 50%. We then screened for those with significant net insider purchases over the last six months, indicating that insiders at these companies expect their employers to outperform.
Interactive Chart: Press Play to compare changes in market cap over the last two years for the stocks mentioned below.
Business Section: Investing Ideas
The results of this screen are below - these dividend stocks have been seeing optimism from their company insiders over the last six months.
Do you agree with them that these names will outperform? Use this list as a starting point for your own analysis. (Click here to access free, interactive tools to analyze these ideas.)
1. Chesapeake Energy Corporation (NYSE:CHK): Engages in the acquisition, development, exploration, and production of natural gas and oil properties in the United States. Dividend yield at 1.44%, payout ratio at 14.16%. Over the last six months, insiders were net buyers of 207, 300 shares, which represents about 0.03% of the company's 630.46M share float.
2. Cintas Corporation (Nasdaq:CTAS): Provides corporate identity uniforms and related business services in North America and Latin America, Europe and Asia. Dividend yield at 1.37%, payout ratio at 26.08%. Over the last six months, insiders were net buyers of 645,158 shares, which represents about 0.59% of the company's 109.69M share float.
3. Ecolab Inc. (NYSE:ECL): Develops and markets products and services for the hospitality, foodservice, healthcare and industrial markets primarily in the United States. Dividend yield at 1.34%, payout ratio at 38.95%. Over the last six months, insiders were net buyers of 6,812,657 shares, which represents about 2.59% of the company's 263.33M share float.
4. L-3 Communications Holdings Inc. (NYSE:LLL): Provides command, control, communications, intelligence, surveillance, and reconnaissance systems; aircraft modernization and maintenance and government services in the United States and internationally. Dividend yield at 2.83%, payout ratio at 19.71%. Over the last six months, insiders were net buyers of 41,044 shares, which represents about 0.04% of the company's 98.33M share float.
5. Legg Mason Inc. (NYSE:LM): Operates as an asset management company worldwide. Dividend yield at 1.11%, payout ratio at 20.12%. Over the last six months, insiders were net buyers of 3,465,000 shares, which represents about 3.07% of the company's 112.88M share float.
6. Titanium Metals Corporation (NYSE:TIE): Mills, manufactures, and distributes titanium and titanium alloys. Dividend yield at 2.19%, payout ratio at 29.74%. Over the last six months, insiders were net buyers of 61,000 shares, which represents about 0.08% of the company's 72.92M share float.
7. Whirlpool Corp. (NYSE:WHR): Engages in the manufacture and marketing of home appliances worldwide. Dividend yield at 2.55%, payout ratio at 37.95%. Over the last six months, insiders were net buyers of 15,500 shares, which represents about 0.02% of the company's 75.94M share float.
Use the Investopedia Stock Simulator to trade the stocks mentioned in this stock analysis, risk free!
Kapitall's Alexander Crawford does not own any of the shares mentioned above. Insider data sourced from Yahoo! Finance.
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