3 CEOs Making Large Insider Purchases

• Insiders continue to take advantage of the ongoing market volatility to snap up seeming bargains.
• Notable insider purchases this past week came from three prominent chief executives.
• Strong insider buying is often considered a positive sign for investors, particularly during volatile times.

Spooked investors may take some comfort in the fact that insiders continue to take advantage of the ongoing volatility to bolster their positions. It is a sign that they are not panicking, further affirmed by the relatively muted level of insider selling of late. Three prominent CEOs have stepped up to the buying window in recent days.

Conventional wisdom says that insiders and 10-percent owners really only buy shares of a company for one reason – they believe the stock price will rise and they want to profit from it. CIT Group Inc. CIT, Post Holdings Inc POST, Tempur Sealy International Inc TPX and Wyndham Worldwide Corporation WYN have all seen notable insider selling, but here we focus on three where the man at the top is leading the way.

JPMorgan

CEO Jamie Dimon scooped two blocks of shares of JPMorgan Chase & Co. JPM at between $53.14 and $53.26 apiece. Altogether that was 500,000 shares and cost him a more than $26.5 million.

That was nearly equal to his salary from last year, according to the New York Times.

The market cap of this financial giant is about $214.8 billion, and it has a dividend yield near 3.0 percent. The share price is down more than 11 percent since the beginning of the year to the close at $58.35 on Tuesday. The Dow Jones Industrial Average was down more than 7 percent in that time.

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Plains All American

Last week. CEO Greg Armstrong bought more than 158,000 Plains All American Pipeline, L.P. PAA shares and a million shares of its general partner, Plains GP Holdings LP PAGP. At $16.06 and $5.86 apiece, respectively, that totaled around $8.4 million.

Investors of either entity enjoy a dividend yield of more than 15 percent. The market cap of Plains All American is near $7.2 billion. Its share price is down around 21 percent year to date to about $18.22, while shares of its general partner are about 30 percent lower to $6.65. The buys look well timed.

Wynn Resorts

CEO Steve Wynn added more than 258,000 shares to his stake in this Las Vegas-based casino resort operator. At between $58.13 and $58.37 per share, the total for the purchases came to around $15.0 million. Note that Wynn also bought $63.8 million worth of shares back in December.

Wynn Resorts, Limited WYNN has a $38.9 million market cap, as well as a dividend yield near 2.9 percent. The stock closed Tuesday at $74.65 a share, so this looks like well-timed buys too. Year to date, shares are up almost 8 percent, largely due to a fourth-quarter earnings beat.

At the time of this writing, the author had no position in the mentioned equities.