Everybody loves a good sale. Corporate insiders picked up their buying activity as stocks got cracked last week. Last week’s list of buyers was noticeably longer than it’s been for the past month. Growing insider interest doesn’t necessarily mean the worst is over for the market. From experience, it’s most likely an indication that some executives feel their stock’s price is close to its intrinsic value.
For the last few weeks, we’ve been working under the idea of creating a watchlist of companies to consider when the bear market shows signs of bottoming. We aren’t there yet despite the indexes rocketing higher at the end of last week. So, we’ll continue to add names to our list of candidates.
This week we are highlighting three companies that meet four specific criteria.
- they trade for less than book value
- total return potential of at least 40% based on the current one-year price target and dividend
- profitable with earnings and revenue forecasted to increase in 2023 compared to 2022
- insiders combined to invest at least $100,000
Air Lease Corporation (AL)
Air Lease Corporation engages in the purchase and leasing of commercial jet aircraft to airlines worldwide. It also sells aircraft from its operating lease portfolio to third parties, including other leasing companies, financial services companies, airlines, and other investors. In addition, the company provides fleet management services to investors and owners of aircraft portfolios. As of December 31, 2021, it owned a fleet of 382 aircraft, including 278 narrowbody aircraft and 104 widebody aircraft.
On May 11, 2022, Chairman Steven Udvar-Hazy purchased 5,000 shares of AL stock at $34.91 for a total investment of $174,530. (1) As we type, the airline leasing company trades at $36.05 with a book value of $61.49 per share. (2) Wall Street currently has a consensus one-year price target of $54.50. (3) Analysts forecast sales climbing to $2.79 billion in 2023 compared to $2.39 billion with earnings per share rising to $5.80 next year versus a loss on $0.81 in 2022. (4)
Current annual dividend per share $0.74 (2.05%)
Total Return Potential to Price Target: 53.23%*
AG Mortgage Investment Trust, Inc. (MITT)
AG Mortgage Investment Trust, Inc. operates as a residential mortgage real estate investment trust in the United States. Its investment portfolio comprises residential investments, including non-qualifying mortgages loans, government-sponsored entity non-owner occupied loans, re/non-performing loans, land-related financing, and agency residential mortgage-backed securities, and commercial investments. The company qualifies as a real estate investment trust (REIT) for federal income tax purposes.
Director Matthew Jozoff acquired 30,000 shares of the REIT on May 10, 2022, at $7.42 for $222,471. (5) Shares are up at bit, $7.87 as of the close on May 13, 2022. AG Mortgage’s book value stands at $14.64. (6) The Street puts a one-year price target of $10.70 on MITT. (7) Earnings are forecasted to hit $1.25 in 2023 versus $0.87 this year with revenue going from $99.56 million in 2021 to $120.40 million next year. (8)
Current annual dividend per share $0.84 (10.67%)
Total Return Potential to Price Target: 46.62%*
Unifi, Inc. (UFI)
Unifi is a global textile solutions provider and one of the world’s leading innovators in manufacturing synthetic and recycled performance fibers. Through REPREVE®, one of Unifi’s proprietary technologies and the global leader in branded recycled performance fibers, Unifi has transformed more than 30 billion plastic bottles into recycled fiber for new apparel, footwear, home goods, and other consumer products.
UFI Chief Executive Officer (CEO) Edmund Ingle bought 5,300 shares at $13.65 and Chief Financial Officer (CFO) Craig Creaturo purchased 10,000 at $13.65. The pair of C-Suite execs invested a total of $211,855. (9) The textile company trades at $14.22 as of this keystroke and has a book value of $20.42. (10) The bottom line is expected to jump to $1.46 per share in 2023 compared to $0.79 this year. The topline is forecasted to increase from $809.37 million in 2022 to $859.60 million next year. (11). The 12-month price target for Unifi is $30.67. (12)
Current annual dividend per share $0.00
Total Return Potential to Price Target: 115.68%*
* Total Return Potential defined as ((one-year price target – current price)/current price)) + dividend yield)
1 – https://www.secform4.com/insider-trading/1487712.htm
2 – https://finance.yahoo.com/quote/AL/key-statistics?p=AL
3 – https://finance.yahoo.com/quote/AL?p=AL&.tsrc=fin-srch
4 – https://finance.yahoo.com/quote/AL/analysis?p=AL
5 – https://www.secform4.com/insider-trading/1514281.htm
6 – https://finance.yahoo.com/quote/MITT/key-statistics?p=MITT
7 – https://finance.yahoo.com/quote/MITT?p=MITT
8 – https://finance.yahoo.com/quote/MITT/analysis?p=MITT
9 – https://www.secform4.com/insider-trading/100726.htm
10 – https://finance.yahoo.com/quote/UFI/key-statistics?p=UFI
11 – https://finance.yahoo.com/quote/UFI/analysis?p=UFI
12 – https://finance.yahoo.com/quote/UFI?p=UFI