Top-level corporate insiders such as CEOs and Chairman tend to have an information advantage over other investors. If these insiders are buying company stock, it’s generally a bullish development.
In this report, we are going to flag some interesting insider buying at Amerco (UHAL:US). Amerco is North America’s largest ‘do-it-yourself’ moving and self-storage operator. The company is listed on the NASDAQ Global Select Market and currently has a market capitalization of $8.7 billion.
Amerco: insider buying
Form 4 filings show that in mid-December, Amerco’s Chairman Edward Shoen purchased stock twice. On 14 December, the insider purchased 3,910 shares for his company Willow Grove Holdings LP at a price of $428 per share. Then, on 15 December, the insider purchased another 1,090 shares for his company at a price of $430 per share. In total, the insider spent around $2.1 million on Amerco stock.
High insider IQ
This insider buying is worth highlighting for two reasons. Firstly, the Chairman has spent a substantial amount of money on shares. This suggests that he is confident the stock is undervalued at present.
Secondly, Shoen’s last purchase was timed well. Our records show that the insider last purchased a substantial amount of UHAL stock in late March when the share price was near $250. In the next six months, the stock rose about 40%.
Strong Q2 results
Amerco recently posted a good set of second-quarter results for the period ending 30 September. For the quarter, self-moving equipment rental revenues were up 16% while self-storage revenues were up 10%. Net earnings available to shareholders were $266.4 million, or $13.58 per share, compared with net earnings of $156.3 million, or $7.97 per share, for the same period last year. For the half year, net earnings available to shareholders were $354.1 million, or $18.06 per share, compared with net earnings of $288.7 million, or $14.73 per share, for the same period last year.
“We are committed to winning. Over the last seven months, we have simply outworked our peer group” the Chairman commented. In light of these strong results, we see the insider buying here as bullish.