February 14, 2013 at 06:31 AM EST
Small-Cap Insider Trading: Should You Pay Attention?

Maryland based Agree Realty Corporation (NYSE:ADC) is engaged in buying and developing single tenant properties leased to leading brick and mortar retail outlets. On January 30, 2013 the company announced the acquisition of Dicks Sporting Goods (NYSE:DKS) and Petsmart in St Joseph Missouri. Stephen P. Sarno and Director John William Poduska Sr. bought shares of Exa Corporation (NYSE:EXA) stock in January as well, while CEO and President Stephen A. Remondi sold shares.

 

For years, investors have been basing their decisions, in part, on insider trading. Peter Lynch had a saying "Insiders might sell their shares for any number of reasons but they buy them for only one: they think the price will rise." Indeed research has shown that when executives have purchased shares in their own companies, the stock has outperformed the market by an average of 8.9 percent for the following 12 months. On the flip side, when they sold shares, the stock underperformed the market average by 5.4 percent for the following year. Following are a couple of small-caps that have experienced recent insider trading.

 

Maryland based Agree Realty Corporation (NYSE:ADC) is engaged in buying and developing single tenant properties leased to leading brick and mortar retail outlets. Agree currently has a portfolio of over 110 properties in 28 states containing 3.3 million square feet of leasable space. On January 30, 2013 the company announced the acquisition of Dicks Sporting Goods (NYSE:DKS) and Petsmart in St Joseph Missouri. Both tenants have around nine and a half years remaining on their respective leases. The cost of the acquisitions combined was around $8.5 million. Two weeks prior, company director John Rakolta purchased 50,000 shares of Agree at a cost of $23.28 per share. On the same day, the company announced the pricing of 1,500,000 shares of its common stock at a public offering price of $27.25 per share. The company will use the money to pay down debt. Agree has a market cap of $325.47 million and is trading at around $28.36.

 

Founded in 1992, Exa Corporation (NASDAQ:EXA) develops and distributes computer-aided engineering software. The company went public in June of 2012. Recent insider trading includes a January 17, 2013 purchase of 15,988 shares by COO Edmond Furlong. Stephen P. Sarno and Director John William Poduska Sr. bought shares of EXA stock in January as well, while CEO and President Stephen A. Remondi sold shares. In fact, since its IPO less than a year ago, the company has had a high volume of insider trading, which is not unusual as Exa finds its place in the public sphere. According to Q3 financial results, company revenue grew by 9 percent comparable to 2011. Exa has a market cap of $125.28 million with shares currently trading at $9.47.

 

Bottom line is that legal insider trading is common among public companies. Company execs are privy to information before the stockholder hears anything. Insider trading can be used as a tool to gauge a company's growth or lack of same. Take it from Peter Lynch; it pays to pay attention to what management is buying or selling.

 

NEW: Feature your company on EmergingGrowth.com. Find out how by filling out our referral form herehttp://emerginggrowth.com/recommend-a-company-to-feature-on-emerging-growth

 

About EmergingGrowth.com

 

By offering 100% original and unmatched content by the best financial reporters, writers and bloggers in the business, EmergingGrowth.com is emerging as a leading digital financial media portal. Its services provide users, subscribers and advertisers with a variety of content and tools through a range of online, social media, mobile and other mobile outlets.

 

Since its inception, EmergingGrowth.com has distinguished itself from other financial media companies with its sly approach to reading between the lines in order to locate that needle in the haystack. Sign up today to see what EmergingGrowth.com has to offer. 

Contact:

EmergingGrowth.cominfo@EmergingGrowth.com305-323-5687

 

Join our Linked in Grouphttp://www.linkedin.com/groups/?gid=4650356&trk=hb_side_g

 

Like us on Facebook... http://www.facebook.com/pages/EmergingGrowthcom/474647062557938

 

Disclosure

All information contained herein as well as on the EmergingGrowth.com website is obtained from sources believed to be reliable but not guaranteed to be accurate or all-inclusive. All material is for informational purposes only, is only the opinion of EmergingGrowth.com and should not be construed as an offer or solicitation to buy or sell securities. In addition, Please make sure you read and understand the Terms of Use, Privacy Policy and the Disclosure posted on the EmergingGrowth.com website. Always remember that investing in securities such as the ones listed within are for high-risk tolerant individuals only and not the general public. Whether you are an experienced investor or not, you should always consult with a stockbroker, financial advisor, or similar before purchasing or selling any securities viewed on any emails sent from EmergingGrowth.com or its website.

 

 

Source: EmergingGrowth.com

Stock Market XML and JSON Data API provided by FinancialContent Services, Inc.
Nasdaq quotes delayed at least 15 minutes, all others at least 20 minutes.
Markets are closed on certain holidays. Stock Market Holiday List
By accessing this page, you agree to the following
Privacy Policy and Terms and Conditions.
Press Release Service provided by PRConnect.
Stock quotes supplied by Six Financial
Postage Rates Bots go here