Bargain hunters are wise to pay careful attention to insider buying, because although there are many various reasons for an insider to sell a stock, presumably the only reason they would use their hard-earned cash to make a purchase, is that they expect to make money. Today we look at two noteworthy recent insider buys.
On Monday, Party City Holdco (PRTY)'s Chief Executive Officer, James M. Harrison, made a $566,250 purchase of PRTY, buying 125,000 shares at a cost of $4.53 each. Investors can grab PRTY even cheaper than Harrison did, with the stock changing hands as low as $4.19 at last check today — that's 7.5% under Harrison's purchase price. Party City Holdco is trading down about 0.5% on the day Thursday. Before this latest buy, Harrison bought PRTY at 2 other times during the past year, for a total cost of $998,497 at an average of $9.84 per share.
And at CIT Group (CIT), there was insider buying on Tuesday, by CEO Ellen R. Alemany who purchased 11,500 shares at a cost of $43.55 each, for a trade totaling $500,817. CIT Group is trading up about 2.5% on the day Thursday. Investors can buy CIT at a price even lower than Alemany did, with shares changing hands as low as $41.01 in trading on Thursday which is 5.8% below Alemany's purchase price.