Investing without an edge can at best guarantee average returns, but when one invests in the markets with an edge the chances of outsize gains increase exponentially. Following insider trades and investing based on them is one such edge that enables retail investors to match the moves of their institutional counterparts and target above average returns. On that note, let’s discuss three stocks which have recently seen insider purchases happening – Republic Services, Inc. (NYSE:RSG), DST Systems, Inc. (NYSE:DST), and Ladenburg Thalmann Financial Services (NYSEMKT:LTS).
NYSEMKT:LTS
Republic Services, Inc. (NYSE:RSG) is a $13.61 billion market cap, second largest non-hazardous solid waste management company in the US. On September 29, William J. Flynn, a director at Republic Services, Inc. (NYSE:RSG), purchased 2,600 shares of the company at a price of $38.76 per share. With this purchase, Flynn’s total holdings of Republic Services, Inc. (NYSE:RSG)’s stock stands at 12,658 shares. An interesting thing to note here is, Bill Gates’ investment arm, Cascade Investment also bought 584,225 shares of the company on September 30, at $38.95 per share. Cascade is one of the largest shareholders of Republic Services, Inc. (NYSE:RSG) and with this purchase it now owns around 107.45 million shares of the company, which at current price are valued at over $4 billion. Based on last fiscal year results, Republic Services, Inc. (NYSE:RSG) has an EPS of $1.99 and trades at 19.20 times price versus earnings.
DST Systems, Inc. (NYSE:DST) is a $3.34 billion market cap, software development company that was founded in 1969. On October 1, Lowell L Bryan, a director at DST Systems, Inc. (NYSE:DST), purchased 238 shares of the company at $83.67 per share. Though the purchase may be small, but Bryan has been continuously increasing his stake in the company’s stock and by including this purchase, now owns a total of 14,212 shares of DST Systems, Inc. (NYSE:DST). Jim Simons’ Renaissance Technologies is also bullish on this stock and as of June 30, 2014, owns 716,700 shares of DST Systems, Inc. (NYSE:DST). Based on last year fiscal results, DST Systems, Inc. (NYSE:DST) has an EPS of $9.91 and trades at 8.48 times price versus earnings. Automated Work Distributor (AWD), which is a business process management software, is one of the main products of DST Systems, Inc. (NYSE:DST).
Ladenburg Thalmann Financial Services (NYSEMKT:LTS) is a $802 million market cap, diversified financial services company based in Miami, Florida. On September 30, Ladenburg Thalmann Financial Services (NYSEMKT:LTS)’s Senior Vice President, Joseph Giovanniello, purchased 1,117 shares of the company at $4.03 per share. Giovanniello total ownership of Ladenburg Thalmann Financial Services (NYSEMKT:LTS)’s stock, after including the current purchase, comes at 102,870shares. Ken Griffin’s Citadel Investment Group is one of the largest shareholders of Ladenburg Thalmann Financial Services (NYSEMKT:LTS). As of June 30, 2014, Citadel Investment Group owns 271,729 shares of the company, which amounts to a marginal decline of 2% in ownership from previous quarter. 12% of all shares of Ladenburg Thalmann Financial Services (NYSEMKT:LTS) are currently owned by institutional investors. The company’s two core businesses are independent brokerage and advisory, and investment banking.
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