Insiders Buying NBTY
Getting Healthy With Nutritional-Supplement Marketer NBTY
By Bob Gabele
Special to TheStreet.com
3/28/01 5:22 PM ET
In February, I mentioned impressive insider buying at nutritional-supplement maker NBTY (NBTY:Nasdaq - news - boards).
At the time, there didn't seem to be a whole lot shaking in the supplement business. In fact, about the best you could say about NBTY was that the company was coasting toward some pretty easy year-over-year comparable figures. Well, that, and the fact that company insiders had previously never let us down.
I bring this up now, not because the stock has quietly crept up some 45% (though that's nice), but because, on the way up, three insiders purchased an additional 622,200 shares at $5.25 to $7.06 a share.
To which I would add the following: 1) Insider buying into this type of strength is exceedingly rare, and, 2) Whether buying or selling, these guys have been dynamite over the years.
If that's not enough, consider this: Scott Rudolph, the company's chairman and CEO, accounted for more than 550,000 shares of the most recent accumulation. And while Rudolph is not a frequent trader, he did manage to lighten up at around $17 last May. More importantly, the last time he hit the open market for shares was in November 1995, ahead of an absolutely ridiculous two-year run.
Getting Healthier
Insiders are buying at NBTY. The last time this happened
the stock went on a two-year run
Little has changed in the two or so months since I last visited NBTY. On second thought, Gary B. Smith gave the chart his blessing a few weeks back. And NBTY has inched its way higher. And Maryland did make it to the Final Four. And insiders kept buying! Come to think of it, that is a lot.
On the flip side, you can add software developer MetaSolv (MSLV:Nasdaq - news - boards) to the list of tech stocks insiders can't stop selling.
The selling, which began within months of the company's November 1999 IPO, really heated up in the middle of last year. Unfortunately, a brutish selloff did little to rein in the insiders.
Quite the contrary, in January and February, eight insiders sold 718,420 additional shares in the mid to high teens. For those of you who are counting, that's more than 85% below last February's peak of about $125.
MetaSolving
The software developer is one of those tech stocks
insiders can do without
Finally, if you're like me, you can't get enough of the technicals vs. fundamentals jousting on RealMoney.com's Columnist Conversation. I'm beginning to detect a creeping interest in Ford (F:NYSE - news - boards) as the stock tests the upper end of its trading range, so I thought I'd toss in my two cents.
In recent years, Ford insiders have both acquired and disposed of shares with relative regularity. Then early this year, as the stock worked its way higher, the insider profile deteriorated. For example, the 650,000-plus shares sold or registered for sale by Ford insiders since Jan. 24 marks the largest consensus round of insider sales in more than two years.
Moreover, this total surpasses the total number of shares sold in 1999 and 2000 combined. Does this mean the stock can't rally from here? Of course not. It's just another piece in the puzzle.
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Bob Gabele has been tracking and analyzing insider trading since 1978, most recently for First Call/Thomson Financial. This column is not meant as investment advice; it is instead meant to provide insight into the methods of insider trading. At time of publication, Gabele held no position in any of the companies discussed in this column, although holdings can change at any time. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Gabele appreciates your feedback and invites you to send any to Bob Gabele. |
