This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

Bullish Trinity: Stocks With Short Covering, Insider & Hedge Fund Buying

When it rains, it pours. It's a saying we apply to our personal lives here and there when things get really good, or really bad. In this case, companies can apply it to their good fortune in investor trends. [Related List: 7 Biotechnology Stocks With Insider Buying Activity]

We made a list of stocks that have signaled not one, but three promising trends that signal optimism among investors.

1. Insider Buying -  If anyone knows what is going on with a company, it has to be the people that work there. But when insiders start to buy up shares of their company, there’s really only one good explanation: They think the share price is undervalued. If they're buying, then insiders are confident there is more upside potential, and might have a hunch their stock is going to rally. Of course, these predictions aren’t always realized, but it’s a strong indicator for outsiders to go by.

We screened for names showing net insider buying in the current quarter in excess of 1% share float. 

2. Institutional Buying - Insider activity alone isn't enough to actually shift market prices. This day and age it's the work of hedge funds that make it their daily business to buy, sell and move millions of shares every day that really get share prices moving. But hedge funds pay attention to insiders too, so insider activity can set a spark that puts institutional buying (or selling) in action. 

Like insiders, institutional sales are closely watched and reported. Here we screen for names showing significant net institutional buying in the current quarter, representing at least 5% of share float.

3. Short Covering - We screened for companies with a recent significant decreases in shares shorted. This signals optimism, or rather a lack of pessimism, from short sellers – a group of investors who benefit when share price falls. 

We screened for names showing short covering month over month in excess of 1.5% share float. 

1 of 3

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,067.56 -30.89 -0.18%
S&P 500 2,001.53 -1.84 -0.09%
NASDAQ 4,596.5470 +16.2760 0.36%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs