Insider Observations

It was a surprisingly busy week for insider activity in which we upgraded 13 stocks mostly in the Financial, Technology, Industrials sectors. We also downgraded 4 stocks, when 3 of them were from Consumer Discretionary.

Interesting that out of the 13 upgrades, 5 we already had ranked prior to the week but additional insider buying allowed us to renew or further upgrade them. Similar comments with the negative ranked stocks. 2 of the 4 we already had ranked yet additional insider selling allowed us to renew/further downgrade those stocks.

Insider sentiment has been improving since the end of August, coincident with the pullback in many stocks. With a 30-day Sell/Buy Ratio of 1.40 (which means 7 sells to 5 buys), we view insider sentiment as neutral with improving trends.

Many insiders will begin their restricted trading periods ahead of quarter-end. And we expect insider trading volume to be low until 3Q earnings have been reported.

Fed officials will join insiders in shutting down their trading in the weeks ahead. Although their trading halt will be more permanent for some of these officials.

If you haven’t seen our comment in LinkedIn on the WSJ article, check it.

This is a short summary of our Highlights report for the US market which we send to our clients every Monday. If you are interested in it, please, email us to sales_admin@smartinsider.com or fill in the Contact form.

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