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In the retail grocery complex, insiders are snapping up shares of
Vitacost.com(VITC), an online retailer and direct marketer of health and wellness products, including dietary supplements, cosmetics, organic body and personal care products and health foods. This stock hasn't done much so far in 2011, with shares down around 2.6%.
Vitacost.com has a market cap of $154.34 million and an enterprise value of $140.15 million. The stock trades at a rich valuation, with a forward price-to-earnings of 92.42. Their estimated growth rate for this year is -328%, and for next year it's pegged at 120%. This is a cash-rich company, with a total cash position of just $16.28 million and total debt of zero.
The CEO just
bought 40,000 shares, or $212,122 worth of stock, between $5.23 and $5.38 per share. This same CEO has been steadily buying stock since September that now totals over $779,000.
From a technical standpoint, this stock is currently trading above both its 50-day and 200-day moving averages, which is bullish. During the last three months, this stock has found some big buying support at around $4.15 to $4.30 a share. The stock is now approaching a big breakout if it can manage to move above some significant overhead resistance.
If you're looking to buy this stock, I would look to get long once it breaks out above $5.67 and then $6.20 a share with solid volume. Look for volume that's tracking in close to or above its three-month average action of 75,000 shares. I would get long over $5.67 and then add aggressively over $6.20 a share as long as the volume is tracking in strong. One could also wait for some weakness and buy at around $5.20 to $5 a share and simply anticipate the breakout. Use a tight mental stop no matter if you buy it off of weakness or strength so you make sure to limit your risk.
To see more stocks with notable insider buying, including
First Bancorp (FBP) and
Neurocrine Biosciences (NBIX), check out the
Stocks With Big Insider Buying portfolio on Stockpickr.
-- Written by Roberto Pedone in Winderemere, Fla.