This doesn’t happen too often. Rarely do we work our way through the previous week’s insider buying roster and fail to find one, just one Rodney (old Miller Lite commercial reference, Google it), purchase with a purpose.
With the COVID, Delta variant upsetting the market, stocks could be set up for some more downside. So, we turned to the other side of the tape for sellers. Now, it’s been said that insiders will unload stock for any reason, new house, vacation, or maybe they feel their stock price is on the high side.
With that in mind, we identified four companies where an insider sold more than $500,000 in stock with the company close to its 52-week high. Additionally, we examined each company’s chart with an eye towards prices that could have more downside than upside, in our opinion.
Here is the quartet:
AutoZone, Inc. (AZO): Current price $1,584.57 versus 52-week high of $1,612.33.
Last week, Chief Investment Officer (CIO) Ronald Griffin sold more than $11.2 million of the auto parts store. Shares of AZO are near the top of their Relative Strength range and could be prone to profit taking. (1)
Bicycle Therapeutics plc (BCYC): Current price $34.50 versus 52-week high of $35.46.
Chief Executive Officer (CEO) Kevin Lee sold 10,000 shares of the United Kingdom-based biotech for a total of $773,838. (2) Bicycle’s Relative Strength reading is 72.50. The last time the biotech topped the 70 mark, its price dipped nearly $10 from $31ish to $21ish.
Copart, Inc. (CPRT): Current price $139.72 versus 52-week high of $141.32
Chief Executive Officer (CEO) Jayson Adair unloaded 130,000 shares of the online car seller, pocketing $18 million. That’s a lot of money but less than the $22 million director Steven Cohan sold. (3) CPRT shares are trading at the top of their Relative Strength range as well. Copart shares are also on the verge of a potential bearish sell signal called a negative, MACD crossunder.
NIKE, Inc. (NKE): Current price $57.87 versus 52-week high of $162.73
The athletic wear and shoe company’s Chief Administrative Officer (CAO) Hilary Kane sold 15,000 shares last week for $2.4 million. That’s small potatoes compared to Chairman Mark Parker’s $22.4 million sell on July 8th. (4)
NIKE stock gapped nearly $20 higher on positive earnings and then ran another $20 points higher in the following two weeks. Now, NKE’s shares are rolling over and could head back towards $150. If the Just Do It company’s price closes below $150, it could close the gap up and return to $135ish.
Of course, these companies have been amongst the strongest performers and that’s why they are near 52-week highs. If the overall market continues to go up, then these four will likely follow along. However, because they are near the top end of their Relative Strength ranges, they are potential underperformers.
1 – https://www.secform4.com/insider-trading/866787.htm
2 – https://www.secform4.com/insider-trading/1761612.htm
3 – https://www.secform4.com/insider-trading/900075.htm
4 – https://www.secform4.com/insider-trading/320187.htm