Investors these days are looking for indicators of whether stocks will continue to rise as they shatter one record after another - or if they will move downward into a correction phase, or worse, a sustained bear market. One bullish sign for individual stocks is insider buying of a company's shares by top executives, especially the CEO. A recent Barron's story looks at 11 CEOs who recently have made large personal investments in their companies' shares, a sign that these leaders are optimistic about their companies and their stock.

These purchases sometimes reflect CEO optimism in the face of cold facts. In May, General Electric Co. (GE) CEO Jeff Immelt put $2.8 million of his own money into GE shares, a seemingly bad bet as GE's stock has dramatically underperformed the market during his long tenure. But the stock has jumped in recent days on news that Immelt plans to step down and that the conglomerate will be led by GE veteran executive John Flannery.

Bullish on Energy

There's been a wave of buying in the energy patch.

Paul M. Rady of oil and gas exploration company Antero Resources Corp. (AR) bought $10.6 million of his company's stock in May. In the same industry, Harold G. Hamm, CEO of Continental Resources Inc. (CLR) has bought almost $7 million so far this year, both for his personal account and for entities that he controls, Barron's says. Hamm has been Continental's only CEO since its founding in 1967, and is likely to remain so as long as he wishes, given that he now owns 77% of Continental's shares, per Barron's.  

Stock purchases of approximately $1 million each were made in May by R.A. Walker of oil and gas exploration company Anadarko Petroleum Corp. (APC) and Thomas J. Nimbley of petroleum refiner PBF Energy Inc. (PBF). With 4 of the 11 CEOs cited by Barron's in the energy sector, one may take this as a positive indicator, despite recent concerns about oversupply driving oil to $30 a barrel. (For more, see also: Why Oil May Plunge to $30 a Barrel.)

In the world of health and nutrition products, interim CEO Robert F. Moran of GNC Holdings Inc. (GNC) invested $5 million in February and another $2 million in May. His personal stake in GNC is 953,271 shares per With 68.4 million shares outstanding, according to the Wall Street Journal, Moran now owns nearly 1.4% of the company.

Other Big Buyers

Tom Greco of Advance Auto Parts Inc. (AAP) was a $2.2 million buyer in May, after investing $1 million in March. Frank Laukien of scientific instrument maker Bruker Corp. (BRKR) bought shares worth $2 million in May, following a $155,000 investment in March. All these figures are per Laukien is Bruker's top stockholder with 40.6 million shares that give him an ownership stake of over 25%, Barron's notes.

Two technology CEOs invested approximately $1 million each in May, per Barron's and Charles Zhang of Chinese-based online media, gaming and mobile applications holding company Inc. (SOHU) and Tom Leighton of cloud computing provider Akamai Technologies Inc. (AKAM).

OPKO's Poor Performance

To be sure, CEO purchases aren't always an indicator of profits to come for investors. 

Just look at Phillip Frost, M.D., CEO of pharmaceutical and medical diagnostics company OPKO Health Inc. (OPK), who has bought OPKO shares nearly every week during his 10-year tenure as CEO, Barron's says. He also is the company's biggest shareholder with a stake of over 29% owned through an investment trust that he controls. 

OPKO's shares have risen by about 50 percent in the past decade, lagging the S&P 500. More sobering, for the year-to-date through June 15, Frost's trust has spent nearly $21 million to buy shares of OPKO in 81 separate purchase transactions, according to SEC Form 4 filings compiled by At a closing price of $6.45 on June 15, the value of these shares has fallen to $19.3 million. Barron's says that they flagged OPKO as being overpriced when it was trading at around $9 last year.

Want to learn how to invest?

Get a free 10 week email series that will teach you how to start investing.

Delivered twice a week, straight to your inbox.