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GAM Trading Below CEO's Recent Buy Price

There's an old saying on Wall Street about insider buying: there are many possible reasons to sell a stock, but only one reason to buy. Back on October 15, General American Investors Incorporated's CEO, Jeffrey W. Priest, invested $148,966.19 into 4,300 shares of GAM, for a cost per share of $34.64. Bargain hunters tend to pay particular attention to insider buys like this one, because presumably the only reason an insider would take their hard-earned cash and use it to buy stock of their company in the open market, is that they expect to make money. In trading on Wednesday, bargain hunters could buy shares of General American Investors Incorporated (Symbol: GAM) and achieve a cost basis even cheaper than Priest, with shares changing hands as low as $34.60 per share. It should be noted that Priest has collected $3.50/share in dividends since the time of their purchase, so they are currently up 10.0% on their purchase from a total return basis. General American Investors Incorporated shares are currently trading off about 0.7% on the day. The chart below shows the one year performance of GAM shares, versus its 200 day moving average:

General American Investors Incorporated Chart

Looking at the chart above, GAM's low point in its 52 week range is $32.30 per share, with $38.32 as the 52 week high point - that compares with a last trade of $34.61. By comparison, below is a table showing the prices at which insider buying was recorded over the last six months:

Purchased Insider Title Shares Price/Share Value
10/14/2014 Jeffrey W. Priest President & CEO 3,700 $34.82 $128,821.90
10/15/2014 Jeffrey W. Priest President & CEO 4,300 $34.64 $148,966.19

The current annualized dividend paid by General American Investors Incorporated is $0.56/share, currently paid in annual installments, and its most recent dividend ex-date was on 11/13/2014. Below is a long-term dividend history chart for GAM, which can be of good help in judging whether the most recent dividend with approx. 1.6% annualized yield is likely to continue.

GAM+Dividend+History+Chart

According to the ETF Finder at ETF Channel, GAM makes up 1.68% of the PowerShares Global Clean Energy Portfolio ETF (Symbol: PBD) which is trading lower by about 0.1% on the day Wednesday.

Click here to find out which 9 other dividend bargains you can buy cheaper than insiders »

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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