I am always watching out for the right stocks to buy on every single day. And on Monday each week, in my Stock Surge Daily – I present three stocks to buy as I place them on the Watch List. And today is no exception as I will do so in a moment.
My analysis is based on my proprietary Surge Stock Indicator (SSI) that at its core identifies stocks that are about to surge. And one of the major cornerstones of the SSI is tracking insider trades and ownership of companies.
Management and board members, called insiders, can buy anything with their own money. And of course, most companies will pay them with some shares and options. But when they pluck down their own cash to buy shares in their own companies – well that’s a big vote of confidence.
Insider buying is always something that everyone needs to look at when evaluating a company. If insiders own a big chuck – and more than for their peers in other companies – that means that the company has more under the hood. And more under the hood is what an investor wants and needs to see in a company before they buy any stock.
And one of the indexes that tracks companies with insider buying is the Nasdaq US Insider Sentiment Index (NQBUY). And this index proves that stocks with insiders buying continue to work out very well for shareholders.
Nasdaq US Insider Sentiment Index Total Return Source Bloomberg
The index has a return over the past 10 years of 316.28% for an annual equivalent return averaging 15.13%. That shows the power of insiders’ eating their own cooking.
Now, one of my recent stocks from the Watch List confirms the tie in with insider buying and stock market performance.
Genco Shipping & Trading (GNK) is in the dry-bulk shipping business. This means shipping all sorts of industrial and agricultural goods that are must have for the US and the globe. And insiders have been buying shares in their own company – adding some 15.78% recently.
The stock was rolled out in Stock Surge Daily back on June 7 – and to now it has returned 21.16% that on an annual basis equates to a return of 4797.55%.
Genco Shipping & Trading Price Source Bloomberg
Ramping Up
I am ramping up my insider research with a new product that we’re launching here at Traders Agency called Insider Edge. And this is all about stocks with big surges in insiders’ buying their own shares.
And on Tuesday, I am presenting my research in complete detail and will provide some new buys right now that I’ve been working on that all focus on insider buying and owning.
This is a phenomenal opportunity to learn more about insider buying and how it really leads to finding great companies and top performing stocks.
Watch List Stocks Now
Now, for today, let’s look at three new stocks which are setting up for big moves this week.
Equifax (EFX)
Equifax is a data acquisition and management company known for its credit scoring system. Revenue is up nicely over the prior year by 17.70% and it maintains ample operating margin for positive returns on shareholders’ equity.
And insiders have been adding to their holdings of the stock by 14.28% recently.
- Surge score: 82/100
- % Above 52-wk low: 77.9%
- MFI reading: 64
- Sales growth: +24%
- Triple momentum: YES
Equifax is the information solutions firm that handles employment, income, and social security number verification.
They’re the ones who compress your entire financial life into a single number that tells banks whether or not to lend you money.
The stock gapped up big in April following better-than-expected earnings.
Shares have been in a tight consolidation range since then but are now trying to break out.
The fundamentals are strong.
Sales and earnings have experienced double digit growth for each of the last four quarters.
From a technical perspective, the trend is clearly long.
Our moving averages are properly stacked and EFX is within pennies of new high ground.
The trigger to enter this trade will be a move above $243.00 per share.
I will work a stop loss order at $230.00 to risk 5.3% on the trade.
Entegris (ENTG)
Entergris provides management of materials for the electronics industry including assemblers and manufacturers. Revenue is up by 16.90% over the past year and the company maintains good operating margins for an attractive return on shareholders’ equity.
- Surge score: 82/100
- % Above 52-wk low: 111%
- MFI reading: 51
- Sales growth: +24%
- Triple momentum: YES
Entegris is a specialty materials manufacturer for the microelectronics industry.
The stock has been steadily trending higher since 2016.
Shares are up 10-fold over the period.
After a 25% surge in late March, ENTG began forming a cup-and-handle pattern that is about to complete.
I want to see a break above $123.00 to get me in this trade.
If it triggers, I will place a stop at $113.50 for a risk of 7.7%.
Keysight Technologies (KEYS)
Keysight Technologies is in the business of measurements using precision instruments for a variety of businesses and industries. Revenue has just surged by 36.43% for the recent quarter that is grabbing market attention. Operating margin is good and in turn feeds a positive return on shareholders’ equity.
- Surge score: 70/100
- % Above 52-wk low: 70.2%
- MFI reading: 68
- Sales growth: +36%
- Triple momentum: YES
Keysight’s surge score barely made the cut of 70 or better.
But this could still be a big performer.
The stock has been consolidating for 6 months, so I’m not surprised to see a score of 70/100.
Unlike the other names on my list, this is one I’d be comfortable buying right now.
We got confirmation at the end of last week as shares blew through the $150 level.
The thick black line on the chart shows a textbook tightening pattern as pullbacks became more and more shallow toward the right side of the chart.
Traders can get away with a tight stop at $146.00 to see if KEYS makes a quick move.
Those looking for a longer-term move in the 30-50% range will need to give the stock a little more room to move with a stop at $139.00.
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