Insiders have access to real-time information on their companies and often also have a wealth of experience that can help them evaluate their firms’ investment potential. If they are spending a substantial amount of money on company stock, it’s generally worth taking a closer look.In this report, we are going to highlight some interesting insider buying at American Campus Communities Inc (ACC:US). American Campus Communities is the largest owner, manager, and developer of high-quality student housing properties in the US. A fully integrated, self-managed, and self-administered equity real estate investment trust (REIT), it owns over 160 student housing properties across the country. The company is listed on the New York Stock Exchange and currently has a market capitalization of $7.1 billion.
American Campus Communities Inc: Insider Buying
Our insider transaction data shows that on January 21, board member John Rippel bought 10,000 ACC shares at a price of $52.00 per share. This trade cost the insider $520,000 and increased his holding to 36,417 shares.
This trade is worth highlighting due to the fact that Mr. Rippel is an experienced real estate investor. He is a founding partner of Alliance Residential Company – one of the largest private US multifamily companies – and has been its Chief Investment Officer since 2001. Given his background, it’s fair to assume that he knows what he’s doing here.
We think it’s interesting that Mr. Rippel has spent over $500k on ACC stock and increased the size of his holding by nearly 40%. This suggests that he is very confident in the outlook for the stock.
American Campus Communities’ Q3 results showed that the company is making a strong recovery after the pandemic.
For the three-month period ended September 30, 2021, revenue totaled $228.9 million versus $202.7 million in the third quarter 2020, while operating income totaled $17.3 million compared to $8.2 million a year earlier. Funds from operations (FFO) for the quarter amounted to $55.4 million, or $0.39 per fully diluted share, as compared to $45.0 million, or $0.32 per fully diluted share for the same quarter in 2020.
It’s worth noting that management was very upbeat in relation to the business environment.
“We are currently experiencing the most substantial fundamental tailwinds we’ve seen in many years, including strong enrollment demand at tier-one universities, low levels of new supply, and significant activity in on-campus public-private partnerships, highlighted by two new development awards and a new project start,” said Bill Bayless, CEO of American Campus Communities.
“We are highly optimistic that the fundamentals of the student housing operating environment provide investors with a unique opportunity for recession resilient, robust internal growth and meaningful earnings growth and net asset value creation in the years ahead,” he added.
In light of the tone from the CEO here, we see the insider buying as a bullish indicator. It suggests that the insider thinks the stock is going higher.