Buying by insiders is still pretty thin.
Most corporate executives, especially in the C-suite, are quite content to sit on their hands and do pretty much nothing.
Thise that need cash infusions for one reason, or another are selling some stock as they always have and always.
Not too many have been motivated to open the ole checkbook and buy more stocks.
That makes those that are seeing some buying even more interesting as potential long term holdings.
I uncovered stocks this week that disappointed the always accurate Wall Street analysts and traders. All four have seen their stock price dip after earnings.
In all four cases more than one insider, at least one of which was a C-suite executive, stepped up to buy shares.
Asure Software (Ticker: ASUR) remains a story of promise colliding with execution challenges. The company delivers cloud-based human capital management solutions to a wide range of small and mid-sized businesses, a sector that has enjoyed steady growth as companies seek to automate payroll, HR, and compliance tasks.
The appeal of Asure's business model lies in its recurring revenue stream and gross margins approaching 70 percent, metrics that should, in time, translate into consistent profitability. However, the second quarter was a reminder that the road remains uneven. Earnings of $0.09 per share fell short of expectations, and revenue also missed consensus estimates.
The balance sheet is stable, with cash roughly in line with debt and a solid free cash flow profile, but net margins remain negative. Investors who believe in the secular tailwind of workforce SaaS will see value at current levels, especially given the relatively low beta and the stock's discount to analyst targets. The challenge will be translating top-line growth into bottom-line consistency in a competitive software landscape.
Insiders seem to think they are up for the challenge. With the stock down 20% over the past month the CEO and one director made open-market stock purchases,
O-I Glass (Ticker: OI) continues to surprise on the upside. Long viewed as a cyclical industrial name tied to beverage and food demand, the company has been in the midst of a structural transformation that is beginning to bear fruit. Second quarter results showed earnings of $0.53 per share, a solid beat over consensus, with revenues steady year-over-year despite global economic headwinds.
Management's focus on cost control, production efficiency, and sustainable manufacturing aligns O-I with growing ESG mandates from large customers. Analysts expect earnings to grow more than 40 percent next year, a rare figure for a mid-cap industrial. For value-focused investors, O-I offers a combination of a depressed valuation, improving fundamentals, and an increasingly favorable product mix.
Traders did not seem to care. They are obviously expecting a slowdown ahead as they sold the stock down more than 15% since the earnings were released.
Insiders disagree. The CFO and General Counsel have both been buying stock as the price fell
Alpine Income Property Trust (Ticker: PINE) is not a household name in the REIT world, but it has quietly built a portfolio of single-tenant retail and industrial assets that generate stable, long-term cash flows. The trust's second quarter results highlighted this stability as revenues climbed nearly 20 percent year-over-year, and occupancy remained near-perfect at 98.2 percent.
Funds from operations continued to grow modestly, and management increased acquisition guidance for the year, signaling confidence in their deal pipeline.
The stock offers an attractive dividend yield of near eight percent, fully covered by recurring cash flows.
The blemish is on the GAAP earnings line, which swung to a larger-than-expected loss in the quarter, a reminder that accounting results in REITs can fluctuate sharply due to depreciation and non-cash charges.
For income-focused investors willing to accept this noise, PINE's combination of yield, portfolio quality, and disciplined growth strategy may offer compelling total return potential.
Insiders certainly have no problem as the CEO, and two other senior executives were both buying the shares on weakness this month.
Portillo's (Ticker: PTLO) remains a small-cap restaurant brand with a cult-like following in its Midwestern stronghold and a growing national footprint. Known for its Chicago-style hot dogs, Italian beef, and over-the-top chocolate cake, the chain has built a loyal customer base and a highly recognizable brand.
The second quarter delivered earnings in line with expectations, but revenue growth of 3.6 percent fell short of forecasts, suggesting some softness in traffic or average check growth.
Expansion into new markets continues, but the near-term challenge will be maintaining same-store sales momentum in a competitive and price-sensitive casual dining environment. Shares have been under pressure this year, leaving them well below analyst price targets.
For investors who believe in the brand's scalability and the potential for national adoption (or just like a good hot dog), the current weakness could be an entry point though patience will be required as the company works through growth pains and macro headwinds in the consumer sector.
With the stock down 30% in the past month the CFO, Senior Counsel and one director have al made large purchases of Portillo's stock.
Insiders do not buy for small gains. In all four instances the executives buying shares of their company on weakness expect to reap several times the price they are paying today.
