Gartner Inc. (IT), Signet Jewelers (SIG), and WPX Energy (WPG) Among the Companies Reporting Notable Insider Trading Activity

While Securities and Exchange Commission rules require executives, directors and other insiders to report purchases or sales in their own company’s stock within two days, an accurate interpretation of insider trading data has become more complicated in recent years. That’s because of the increased usage of equity-based compensation, as well as the proliferation of pre-arranged trading plans. As more directors and executives sell shares under the so-called 10b5-1 plans, it is close to impossible to figure out the reasoning behind their moves, while stock-based compensation packages make it even harder to find out why corporate insiders might be selling shares. Meanwhile, insider buying activity has become more useful than ever, but one should still keep in mind that corporate insiders are susceptible to biases and errors like any other human being. However, they are in the best position to accurately evaluate the prospects and current conditions of their companies, which is why Insider Monkey keeps track of their moves on a daily basis. Our team processed the Form 4 filings submitted with the SEC on Wednesday and identified five companies with noteworthy insider trading transactions.

Academic research has shown that certain insider purchases historically outperformed the market by an average of seven percentage points per year. This effect is more pronounced in small-cap stocks. Another exception is the small-cap stock picks of hedge funds. Our research has shown that imitating the 15 most popular small-cap stocks among hedge funds outperformed the market by nearly a percentage point per month between 1999 and 2012 (read more details here).

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Biopharmaceutical Company’s Executive Buys Big

The Medicines Company (NASDAQ:MDCO)’s Chief Corporate Development Officer and Executive Vice President, Christopher T. Cox, purchased a new stake of 53,340 shares on Tuesday, of which 26,340 shares are held indirectly through an account to which Mr. Cox’s immediate family has a pecuniary interest. The shares were purchased at prices that ranged between $36.46 and $38.02 per share.

The global biopharmaceutical company, whose main pillar of growth in recent years was Angiomax (bivalirudin), has seen its market value gain nearly 3% since the beginning of the year. The Medicines Company (NASDAQ:MDCO)’s net product revenue from sales of Angiomax was $16.9 million for the first three months of 2016, a monumental decrease of $83.8 million relative to the same period of the previous year. The massive decline in Angiomax sales was primarily driven by strong competition from generic versions of bivalirudin after the company lost market exclusivity for the drug in the U.S and Europe last summer. Roberto Mignone’s Bridger Management had 3.10 million shares of The Medicines Company (NASDAQ:MDCO) in its pool of holdings at the end of March.

Diamond Jeweler Witnesses Increased Insider Buying Amid Bearish Report

Our database shows that Signet Jewelers Ltd. (NYSE:SIG) had not registered any insider buying activity since early 2012 until this week. Chief Executive Officer Mark S. Light snapped up 2,897 shares on Tuesday at a cost of $86.22 per share, lifting his overall holding to 85,395 shares. Moreover, Board member H. Todd Stitzer purchased 3,480 shares on the very same day at a price tag of $86.25 per share. After the recent purchase, Mr. Stitzer currently owns 10,852 shares of Signet.

The insider buying activity comes shortly after Grant’s Interest Observer investment newsletter raised concerns about the credit operations of the world’s largest retailer of diamond jewelry, as well as referencing a media story about customers complaining that their premium diamonds had been replaced with cheaper, lesser-quality substitutes. In a fresh statement, Signet Jewelers Ltd. (NYSE:SIG) rebuffed the allegations saying that “we strongly object to recent allegations on social media…that our team members systematically mishandle customers’ jewelry repairs or engage in diamond swapping.” Signet Jewelers shares have plunged by 28% since the start of 2016. Keith Meister’s Corvex Capital owns 5.93 million shares of Signet Jewelers Ltd. (NYSE:SIG) as of March 31.

On the next page of this article we’ll discuss the insider trading activity registered at three other companies.

Oil-Focused Energy Company Registers Insider Buying Despite Skyrocketing Stock

WPX Energy Inc. (NYSE:WPX) also had two corporate insiders purchase shares earlier this week. To start with, President and Chief Executive Officer Richard E. Muncrief bought 20,400 shares on Monday for $9.80 each, which lifted his ownership to 732,481 shares. William G. Lowrie, the Chairman of WPX Energy’s Board, acquired a slightly smaller block of 10,000 shares on the same day at $9.80 apiece, boosting his stake to 237,076 shares.

The oil-focused energy company has seen its market capitalization skyrocket by 88% since the beginning of 2016. In early February, WPX Energy Inc. (NYSE:WPX) reached an agreement to sell its Piceance Basin operations for $910 million, with the transaction successfully closing in early-April. Just recently, the company also announced plans to raise $485 million through a public offering of 49.50 million shares of common stock. Meanwhile, analysts at Seaport Global upgraded WPX Energy to ‘Neutral’ from ‘Sell’, citing an eased leverage burden, higher commodity prices and operational progress. Israel Englander’s Millennium Management was the owner of 9.14 million shares of WPX Energy Inc. (NYSE:WPX) at the end of the first quarter.

IT Research Firm Witnesses Strong Insider Selling as Stock Nears 52-Week High

Eugene A. Hall, Chief Executive Officer of research firm Gartner Inc. (NYSE:IT), sold 48,413 shares on Monday at prices between $102.17 and $102.64 per share. Following the recent sale, Mr. Hall holds an ownership stake of 1.17 million shares. Additionally, David Godfrey, Senior Vice President of Worldwide Sales, discarded 2,973 shares on Friday for $102.09 each, trimming his holding to 9,331 shares.

The shares of the information technology research and advisory company are up by 11% thus far in 2016 and trade near their 52-week high reached at the end of May, which somewhat justifies the recent insider selling at the company. Gartner Inc. (NYSE:IT) recorded total revenue of $557.3 million for the first quarter of 2016, which was up by 18% year-over-year. The company’s top-line grew by 21% year-over-year, adjusted for the negative impact of foreign currency headwinds. Brian Bares’ Bares Capital Management upped its position in Gartner Inc. (NYSE:IT) by 17% during the January-to-March quarter, to 1.02 million shares.

Two of This Trucking Company’s Executives Sell Shares

J B Hunt Transport Services Inc. (NASDAQ:JBHT) also had two executives offload shares earlier this week. Terrence D. Matthews, President of Intermodal and an Executive Vice President of the company, jettisoned 10,000 shares on Monday at $82.50 apiece, reducing his direct ownership stake to 4,909 shares. More importantly, President and Chief Executive Officer John N. Roberts sold 60,000 units of common stock on the same day for $82.49 each, after which he currently owns 226,967 units.

The well-known trucking company has seen its shares advance by 10% since the start of the year. J B Hunt Transport Services Inc. (NASDAQ:JBHT)’s bottom-line figure has been given a boost from lower fuel costs in the past several quarters and expenses for gasoline, diesel and jet fuel are anticipated to be low for the remainder of the year for most transportation companies. The North American surface transportation, delivery, and logistics company posted operating revenue of $1.53 billion for the first quarter, up from $1.44 billion reported a year earlier. Ken Griffin’s Citadel Advisors LLC reported owning nearly 475,000 shares of J B Hunt Transport Services Inc. (NASDAQ:JBHT) in its latest 13F filing.

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