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TheStreet Open House

5 Stocks Insiders Love Right Now

Stocks in this article: CHRSXLOPKALNYGILD

XL Group

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Another name that insiders are loading up on is property and casualty player XL Group (XL), which, through its subsidiaries, is a global insurance and reinsurance firm providing property, casualty and specialty products to industrial, commercial and professional firms, insurance companies and other enterprises on a worldwide basis. This stock is up just over 2.5% so far in 2012.

XL Group has a market cap of $6.46 billion and an enterprise value of $4.9 billion. This stock trades at a reasonable valuation, with a forward price-to-earnings of 9.33. Its estimated growth rate for this year is 567.9%, and for next year it's pegged at 16%. This is a cash-rich company, since the total cash position on its balance sheet is $3.83 billion and its total debt is $2.28 billion.

The CEO just bought 25.115 shares, or around $500,000 worth of stock, at $19.94 per share. The CFO also just bought 12,660 shares, or about $253,000 worth of stock, at $20.05 per share.

From a technical perspective, XL is currently trading above its 50-day moving average and right below its 200-day moving average, which is neutral trendwise. For the past four months, this stock has found buying support at around $18.60 to $18.80 a share. Shares of XL have run into selling resistance at around $22 to $21.50 a share.

If you're bullish on XL, then I would look for long-biased trades either below $19 a share where the buyers seem to like the stock or off a near-term breakout. That near-term breakout will trigger once XL takes out $20.51 and then $21.91 a share with high-volume. Look for volume on a move above those levels that's near or well above its three-month average action of 3,836,580 shares. Target a run up toward $23 a share if that near-term breakout triggers soon.

XL is one of John Paulson's top holdings as of the most recently reported period, with a 17.1 million-share stake in the stock that comprises 2.4% of Paulson & Co.'s total portfolio.

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