Insider Buying Metric Points At 3 Stocks Poised To Grow In 2016

Prospect Capital Corporation (NASDAQ:PSEC) registered an extremely high volume of insider buying in December, and even ‘insider trading anomaly’ skeptics should pay close attention to this company’s insider trading behavior. To start with, Chief Executive Officer John F. Barry purchased 4.12 million shares during the holiday-shortened trading week ahead of Christmas at prices that fell between $6.76 and $7.38 per share. After the recent sizable purchases, the CEO currently holds a 12.97 million-share stake. Chief Operating Officer M. Grier Eliasek bought 150,000 shares during the same week at a weighted average price of $6.87, lifting his stake to 627,196 shares. This business development company (BDC) mainly lends to and invests in middle market privately-held companies, and its financial performance is strongly correlated with borrower risk. BDCs, including Prospect Capital, generate returns by issuing high-yield loans to privately-held companies, which explains the recent slump of Prospect’s stock. The shares of Prospect Capital are down by nearly 16% over the past one-year period and are trading substantially below the company’s Net Asset Value (NAV), which could somewhat explain executives’ major purchases. A total of 12 smart money investors tracked by Insider Monkey had stakes in the company at the end of the third quarter. Scopia Capital, managed by Matt Sirovich and Jeremy Mindich, owns 2.26 million shares in Prospect Capital Corporation (NASDAQ:PSEC) as of September 30.

Last but not least, Herman Miller Inc. (NASDAQ:MLHR) had two different insiders purchase shares in the past two weeks or so. John G. Edelman, Chief Executive Officer of Design Within Reach (a North American marketer and seller of modern furniture, lighting, and accessories acquired by Herman Miller in 2014), acquired a new stake of 3,600 shares on December 23 for $28.43 each. Moreover, President of Design Within Reach purchased a 3,000-share stake on December 21 at $28.36 apiece. The office-furniture company has seen its shares drop by nearly 3% over the past year, after plummeting 14% since the beginning of December. In mid-December, the company reported its financial results for the second quarter of fiscal 2016, ended November 28. Herman Miller posted net sales of $580.4 million for the quarter, up by 2.7% year-on-year. Its net earnings per share reached $0.57 on a diluted basis, as compared with $0.46 reported a year ago. The company has a relatively cheap valuation at the moment if considering its price-to-earnings ratios. The stock trades at a forward P/E of 12.17, which is notably below the average of 17.44 for the companies included in the S&P 500. Ken Grossman and Glen Schneider’s SG Capital Management acquired a 565,457-share stake in Herman Miller Inc. (NASDAQ:MLHR) during the third quarter.

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