Insider transactions can give investors a more complete view of activity within the world’s publicly-listed companies. No one has more knowledge of a company, and its prospects, than its leaders.
Here, we are going to highlight some interesting insider purchases at Intel Corp (INTC:US). Intel is a leading semiconductor chip manufacturer, which in recent years, has transformed itself beyond a PC-centric company to have a stronger focus on data. It is listed on the NASDAQ Global Select Market and currently has a market capitalization of $225 billion.
Intel Corp: Insider Buying
Form 4 filings show that two insiders at Intel Corp have bought INTC stock recently. On 25 January, CEO Bob Swan purchased 27,244 shares at a price of $55.57 per share. This transaction cost the insider $1.5 million. Then, on 26 January, CFO George Davis purchased 9,095 shares at a price of $55.34 per share. This transaction cost approximately $500,000.
This insider buying activity looks bullish for a couple of reasons. Firstly, these are top-level insiders that have purchased stock. Swan has served as CEO since 2019 and was previously CFO for several years. Davis, meanwhile, has served as CFO since 2019. Both insiders are likely to have an excellent understanding of the company’s future prospects.
Secondly, these purchases are substantial. Our data shows that Swan’s purchase has increased the size of his holding by 9% while Davis’ purchase has increased the size of his holding by 13%. This indicates that the insiders are confident Intel stock is undervalued at present.
Intel recently posted a solid set of fourth-quarter results. For the quarter, revenue was $20.0 billion, exceeding October guidance by $2.6 billion, while non-GAAP earnings per share were $1.52, exceeding October guidance by 42 cents. Full-year revenue set an all-time Intel record of $77.9 billion, up 8% year on year.
“We significantly exceeded our expectations for the quarter, capping off our fifth consecutive record year,” commented Bob Swan. “Demand for the computing performance Intel delivers remains very strong and our focus on growth opportunities is paying off. Intel is in a strong strategic and financial position as we make this leadership transition and take Intel to the next level.”
It’s worth noting that activist investor Third Point recently announced a stake in Intel. Third Point, which is run by Dan Loeb, is pushing the technology company to explore strategic alternatives after it has lost market share to rivals such as Taiwan Semiconductor Manufacturing Co, Advanced Micro Devices Inc and NVIDIA Corp.
In light of these developments, we see the insider buying here as bullish.