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The 90-Day Payday: 3 Must-Own Stocks With HUGE Insider Buying
There’s no getting around it…
Investors had a rough 2022. The S&P 500 was down nearly 20%, its worst year since 2008.
Inflation hit near record levels, and fuel prices skyrocketed. And mortgage rates are still soaring higher even as inflation and fuel prices have begun to level off and decline.
And to top it all off, the stock market is still beyond volatile well into 2023, shooting up one day and plummeting the next.
Some stocks are going to drop further, and you need to be careful right now with which stocks you hold in your portfolio.
And you can know which stocks to buy by following one very important rule…
Invest like an insider.
You need to think in the long term and pay attention to what company insiders are doing. After all, company insiders might sell shares of their company for many reasons, but they buy shares for only one reason: They expect they’ll go up in value.
And insiders know more about their companies than you or I could ever hope to. So when they buy, with all the unique knowledge they have as insiders, it’s a very good indicator that a stock has a bright future.
That’s what underpins my investment philosophy. And it’s why the companies I recommend in The Insider Alert all meet four criteria…
- I want to see big purchases – buys of over $1 million.
- I want to see cluster buying, meaning that several insiders are all buying shares around the same time.
- I want to see far more insiders buying than selling.
- I want to see buying from insiders who have good track records trading their company’s shares.
And the longest you usually have to wait to reap profits on companies that match those criteria is 90 days. Large amounts of insider buying and a solid earnings report (which is normally released every 90 days) are often the catalysts a stock needs to skyrocket.
And we can ride the coattails of those insiders to our own profits.
And the three companies in this report are set up to deliver you a few 90-Day Paydays…
Bet on the Asset They Can Never Make More Of
It’s an old cliché that land is the one asset they aren’t making any more of. Well, it might be cliché, but it’s true.
We can discover new mineral deposits. We can create entirely new synthetic materials to replace the natural resources we do deplete. But land… there’s only a finite amount of that.
And that’s why real estate is almost always a smart bet, regardless of the state of the broader economy. The only issue is that it’s expensive, and by extension, it’s risky to sink hundreds of thousands or millions of your dollars into an asset that may take years or even decades to appreciate.
Fortunately, we can remove that risk by purchasing shares in one of Warren Buffett’s favorite assets: a real estate investment trust, or REIT, like American Assets Trust (NYSE: AAT).
American Assets Trust has been in the REIT business for more than 50 years now, renting its more than 12 million square feet of real estate to businesses and individuals across the West Coast and Southwest.
It holds property in some of America’s most dynamic and fastest-growing cities, like San Francisco, San Diego, Portland and San Antonio.
What’s more, it has big expansions in the works for its offices and retail properties in San Diego, Portland and Honolulu…
All that has contributed to a fantastic balance sheet. For the fourth quarter of 2022, the company managed a 4% increase in funds from operations per diluted share quarter over quarter and a 17% increase year over year.
Meanwhile, for 2022, net revenue was up 12% over 2021’s, while net income was up a solid 52% over 2021’s.
Another thing worth noting is a unique perk of REITs: They must redistribute 90% of their profits as dividends, so they usually pay out fat dividend checks.
At present, American Assets Trust has a 4.97% dividend yield, so this might be one you’ll want to hang on to after its 90-Day Payday. What’s more, the company just raised its dividend by 3%.
Speaking of…
American Assets Trust is set up for a great 2023…
At least company insiders think so, namely Chairman and CEO Ernest Rady, who purchased $3.3 million worth of shares in 2022.
Share purchases totaling $3.3 million with no sales by the leader of the company is a great sign that we should get in quickly.
And given its dividend payout, you may want to hold on to this one even longer, but that’s up to you…
***Action to Take***
Buy American Assets Trust (NYSE: AAT) at market.
The House Always Wins
“The house always wins” is an old adage, and a trip to Las Vegas will prove it is 100% true.
It doesn’t matter how hot your lucky streak is at the slot machines or blackjack table, and it doesn’t matter how good your bluffing is at the poker table. At the end of the night, the house makes money… a lot of money.
Well, to keep with the casino metaphor, modern banks are the “house” in today’s economy. We learned that back in 2009 when many of them were declared “too big to fail.”
Modern banks are simply too big and too critical to the economy. The house always wins. So perhaps if we invest in the house, we’ll always win too…
And that’s why you should take a look at PacWest Bancorp (Nasdaq: PACW), a midsize bank holding company with more than $41 billion in assets hailing from Los Angeles.
With 69 full-service locations across California and branch offices in Denver and Durham, North Carolina, along with lending offices and venture banking locations in some of the United States’ most dynamic and fastest-growing economic regions, PacWest is well positioned in its own state and has footholds in the middle of the country and the East Coast to provide it with avenues for expansion.
However, even though PacWest is on the smaller end of banks, this opportunity represents some very big money…
Net interest income for 2022 topped $1.3 billion, up 16.6% over 2021’s. Loans grew $5.7 billion, up 24.7% over loans in 2021.
PacWest has a diverse loan and lease portfolio, ranging from family loans to construction, land and civic loans. That ensures that even if one sector of lending cools off, there are plenty of others to pick up the slack.
The bottom line is this: PacWest is already a rising star in the banking industry with nearly all of its operations concentrated in just one state. And it’s primed for rapid future expansion. And the company’s leaders agree…
In 2022, Monica Sparks, the chief accounting officer, bought $100,000 worth of shares; President and CEO Paul Taylor bought $200,000; and Executive Vice President Rebecca Cordes loaded up on $250,000. None of them have sold, and on February 3, 2023, Director C. William Hosler bought $99,300 worth of shares.
Those are some heavy hitters within the company all loading up on hundreds of thousands of dollars’ worth of shares – with their own money, mind you. I can’t ignore something like that, and neither should you…
So the next time the house wins big, ensure you do as well.
***Action to Take***
Buy PacWest Bancorp (Nasdaq: PACW) at market.
The Automotive Vending Machine
It’s not often that a company comes along and completely changes the way an industry operates, but that’s exactly what Carvana (NYSE: CVNA) is doing to the used car industry right now…
Buying a car is never fun. That goes double for used cars, to the point where used car salesmen are often portrayed as slimy, in line with public perception of politicians and lawyers.
But you don’t have to spend hours on a used car lot haggling over an old jalopy that turns out to be a lemon a week after you’ve driven off with it. Not anymore.
No, Carvana is something like an online automotive vending machine. You can browse the company’s entire inventory from its website, and the price you see is what you pay. No haggling, no hidden costs, no pushy dealer trying to upsell you on things you don’t need or want.
Then, Carvana delivers the car to your doorstep, and if you don’t like it, you can return it and get your money back within seven days. The car even comes with a 100-day warranty from Carvana.
You can even sell your car the same way. No need to arrange a ride home after selling it – Carvana will buy it from you and then send a truck around to pick it up. It’s that simple.
Carvana is turning a process that used to be arduous and painful into one as simple as ordering something from Amazon.
And despite recent headwinds, Carvana is well on its way to becoming the Amazon of auto sales.
Revenue in 2022 grew 6% year over year in a bad economic year with low consumer confidence…
With the market appearing to be on the mend, Carvana’s trend of rapid growth is sure to continue…
Carvana is forecasting a significant increase in core earnings by the end of next year, and analysts have placed the average price forecast at $100, more than 1,000% above its current share price…
And its insiders must believe it because this company has the most insider buying of the three companies mentioned. Since May 5, 2022, major insiders have bought $47 million worth of shares.
Some of the highlights include Director Dan Quayle, who bought $733,875 worth of shares; Chief Product Officer Daniel Gill, who bought $2 million worth; and President and CEO Ernie Garcia III, who bought an astounding $42 million worth in mid-June.
Not one of them has sold so much as a single share.
That sort of insider buying says to me that this stock is incredibly undervalued and that now is a very good time to buy in…
***Action to Take***
Buy Carvana (NYSE: CVNA) at market.
Investing Like an Insider
At the end of the day, to succeed in the markets, you need to keep your head on your shoulders and not give in to emotion.
Bear markets are short; bull markets are long. And if you can position yourself well at the bottom of a short bear market, you can profit handsomely throughout the long bull market that follows it.
So here’s how you beat the current downturn: Think long term, ignore the financial media that wants you to panic and sell everything, keep your wits about you, and trade like an insider.
Do that, and you’ll have a string of 90-Day Paydays to carry you through the bear markets and help you profit handsomely in the bull markets.