Markets

Will Insiders Be Tempted To Buy More LCII At The New 52-Week Low?

In trading on Wednesday, shares of LCI Industries (Symbol: LCII) touched a new 52-week low of $80.08/share. That's a $52.64 share price drop, or -39.66% decline from the 52-week high of $132.72 set back on 12/29/2017. Large percentage drops always require that the stock post even larger percentage gains from the low in order to recover the old price point, and for LCII that means the stock would have to gain 65.73% to get back to the 52-week high. For a move like that, LCI Industries would need fundamental strength at the business level.

Here's a rhetorical question: Who knows more about fundamentals at the business level than the company's own insiders? So let's take a look to see whether any company insiders were taking the other side of the trade as LCII shares were being sold down to this new 52-week low, focusing on the most recent trailing six month period. As summarized by the table below, LCII has seen 5 different instances of insiders buying over the past six months.

Purchased Insider Title Shares Price/Share Value
05/09/2018 James Gero Director 10,000 $89.34 $893,360.00
05/16/2018 Virginia Henkels Director 2,000 $88.55 $177,100.00
05/10/2018 Kieran M. O'sullivan Director 700 $89.43 $62,601.00
06/04/2018 Jason Lippert Chief Executive Officer 6,000 $83.83 $502,980.00
06/01/2018 Scott T. Mereness President 4,000 $85.00 $340,000.00

In the short run, while the new 52-week low suggests the stock is at the cheapest price and perhaps therefore the best bargain it has been over the last 52 weeks, the low print also means anyone who has purchased the stock over that timeframe is staring at an unrealized loss. Oftentimes, that factor drives a stock's technical analysis metrics by creating overhead resistance, with investors who bought higher now anxious to reverse their trade once they are back to breakeven. The chart below shows where LCII has traded over the past year, with the 50-day and 200-day moving averages included.

LCI Industries Moving Averages Chart

Time will tell whether the insider purchases foretell a future rebound for LCII shares, which are presently showing a last trade of $80.72/share, slightly above the new 52-week low.

Ten Bargains You Can Buy Cheaper Than The Insiders Did »

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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