For the uninitiated, Sally is our Lady of the I-buy, our near real time alert service that calls attention to insider buying on the open market, which itself is often a harbinger of higher stock prices. You can read more about Sally here.
Last week Sally pointed out that Insiders were all over NR - Newpark Resources. This is not a typical series of I-Buys, where Insiders try to scoop up a severely undervalued stock that has gotten unjustly whacked in the marketplace. Here, Insiders have been buying what they consider a severely undervalued stock as it is racing to new highs....every day last week. In the past five trading days NR has risen from $6.50, to $7.68 this morning, or about 20%.
NR started 2006 at about $9.50 a share. Is it headed back that high, or higher? NR's Insiders seem to be weighing in on this question with their wallets. As for me, 4 out of 5 I-buys are day-trades for me, trading the pop that usually follows the public dissemination of Insider-Buys.
But about one of the five, I hang onto longer term, and that is the case here. As long as NR is headed up, up toward double figures, I'm along for the ride.
A
Hi A:
ReplyDeleteI got in on NR last week after a couple Sally alerts as well. I think this near vertical climb is not sustainable and there will be a retrace. What are you looking for as your exit signal?
Greg Reiman
What are you looking for as your exit signal?
ReplyDeleteGreg, it's like a definition of pornography. I can't describe it, but I'll know when I see it.
A
Allan,
ReplyDeleteCan Sally or maybe "Fred" track planned insider sells? I read in BusinessWeek that although the executives of corporations have to plan their sales, they still outperform the market. This would be a great tool...if it were public knowledge.
Thanks.
Hi A:
ReplyDeleteI received my first break out alert since subscribing to the Mauthe site. I bought some of his pick, NTRZ, even thought I thought it was a kind of nutty pick. In looking at the charts, the actual breakout appears to have happened in October, early or late, depending on what past high you use for a referrence point. So I don't get his reasoning here.
I put a very tight stop on ($.10 under my per share cost basis) which almost guarantees that I will get stopped out.
We shall see.
Greg
Greg, here are the most recent intraday break-outs from Mauthe:
ReplyDeleteOct 11th FTGX
Oct 17th CHTR
Oct 23rd AMAG
Nov 14th IONA
Nov 15th INAP
Dec 18th NTRZ
Conclusion: Not perfect, but some huge winners in there. You got to take em all.
A
Hi A:
ReplyDeleteThe first three are impressive, the last three all look like the actual breakout took place a month or two earlier then his alert. At least based on my understanding of the criteria published on his web site.
GTR
Allan, a stock that you highlighted many months ago and has since dropped 50%, is XDSL. When I last checked the insider transactions on this stock it is all insider purchases. Do you think this would be a good time to pick up XDSL for a January effect play and perhaps longer term speculation?
ReplyDeleteRe: XDSL
ReplyDeleteThis is a roll-of-the-dice pick, but you have identified why it may be worth holding here.
A
I would lie to placed on the
ReplyDeletesally recipient list.
gjohnson7721@cfl.rr.com