A Few Insiders Saw Value Before the Rally
Investors might have been tipped to the current rally in stocks by the recent behavior of a few corporate insiders.
In the past few weeks, a number of executives have offered to take their public firms private by purchasing all the outstanding shares that they don't currently own, indicating to some analysts that stocks are deeply undervalued.
"To me, this is consistent with what we're seeing in terms of insider activity," said Michael Painchaud, director of research and principal at Market Profile Theorems. "Insiders are stepping up more aggressively to buy stock as opposed to sell stock."
On Monday, Quintiles Transnational (QTRN), which provides testing services to drugmakers, said its chairman, Dennis Gillings, had offered to buy the firm for $1.34 billion, or $11.25 a share, representing a 35% premium over last Friday's share price.That offer comes on the heels of a similar proposal from the CEO and president of trucking firm Landair Corp. (LAND). The two executives made a formal offer Friday to buy the company for $18.6 million, or $13 a share in cash -- a 25% premium over Thursday's stock price.
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