Top Buys by Directors: Rakolta Jr.'s $596K Bet on ADC

The directors of a company tend to have a unique inside view into the business, so when directors make major buys, investors are wise to take notice. Presumably the only reason a director of a company would choose to take their hard-earned cash and use it to buy stock in the open market, is that they expect to make money — maybe they find the stock very undervalued, or maybe they see exciting progress within the company, or maybe both. So in this series we look at the largest insider buys by company directors over the trailing six month period, one of which was a total of $596K by John Rakolta Jr., Director at Agree Realty Corp. (ADC).

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Rakolta Jr. bets big on ADC:
Purchased Insider Title Shares Price/Share Value
11/21/2013 John Rakolta Jr. Director 20,000 $29.80 $596,000.00

Rakolta Jr.'s average cost works out to $29.80/share. In trading on Thursday, bargain hunters could buy shares of Agree Realty Corp. ( ADC) and achieve a cost basis lower than Rakolta Jr., with shares changing hands as low as $28.97 per share. It should be noted that Rakolta Jr. has collected $0.41/share in dividends since the time of their purchase, so they are currently down 1.4% on their purchase from a total return basis. Shares of Agree Realty Corp. were changing hands at $29.04 at last check, trading up about 0.4% on Thursday. The chart below shows the one year performance of ADC shares, versus its 200 day moving average:

Agree Realty Corp. Chart

Looking at the chart above, ADC's low point in its 52 week range is $26.62 per share, with $34.25 as the 52 week high point — that compares with a last trade of $29.04.

The current annualized dividend paid by Agree Realty Corp. is $1.64/share, currently paid in quarterly installments, and its most recent dividend ex-date was on 12/18/2013. Below is a long-term dividend history chart for ADC, which can be of good help in judging whether the most recent dividend with approx. 5.7% annualized yield is likely to continue.

ADC+Dividend+History+Chart

According to the ETF Finder at ETF Channel, ADC makes up 3.66% of the KBW Premium Yield Equity REIT Portfolio ETF ( KBWY) which is trading lower by about 0.1% on the day Thursday.

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