We are in a malaise. It’s that period when most insiders are restricted from trading in their company’s stock due to the upcoming quarterly earnings. But let’s not kid ourselves.
Name: Abhijit Y Talwalkar
Position: Director
Transaction Date: 2024-11-04 Shares Bought: 6,664 Average Price Paid: $75.16 Cost: $500,866
Company: iRhythm Technologies Inc. (IRTC)
iRhythm Technologies, Inc., founded in 2006, is headquartered in San Francisco, California. iRhythm Technologies, Inc. is a digital healthcare firm that designs, develops, and commercializes device-based technologies for ambulatory cardiac monitoring and arrhythmia diagnosis in the United States. It provides Zio services, which are ambulatory monitoring solutions that include long-term and short-term continuous monitoring, as well as mobile cardiac telemetry monitoring. The company also offers the Zio Monitor System, a prescription-only, remote electrocardiogram (ECG) monitoring system that consists of a patch ECG monitor that records the electric signal from the heart continuously for up to 14 days, and the Zio ECG Utilization Software System, which supports the capture and analysis of ECG data recorded by the Zio Monitor patch at the end of the wear period, including specific arrhythmia events detected by the ZEUS System.
Abhijit Y. Talwalkar has been a member and Chairman of the Board of Directors since May 2016. From May 2005 to May 2014, Mr. Talwalkar served as President and CEO of LSI Corporation, a prominent developer of silicon, systems, and software technologies for the storage and networking markets. Mr. Talwalkar worked for Intel Corporation from 1993 to 2005, where he held various senior management positions, including Corporate Vice President and Co-General Manager of the Digital Enterprise Group, which included Intel’s business client, server, storage, and communications businesses, as well as Vice President and General Manager of the Intel Enterprise Platform Group. Mr. Talwalkar joined the board of directors of Advanced Micro Devices, a renowned provider of high-performance computing, graphics, and visualization products, in August 2017. Mr. Talwalkar has been a member of TE Connectivity Ltd.’s board of directors since March 2017, after serving as an advisor to the board from August 2016 to March 2017. He has a B.S. in electrical engineering from Oregon State University.
Opinion: There was a good bounce from Director Talwakar’s purchase, but it will be hard to maintain. IRTC is not profitable and torrid growth is hard to maintain.
Name: Sarah London
Position: Chief Executive Officer
Transaction Date: 2024-11-08 Shares Bought: 4,117 Average Price Paid: $60.80 Cost: $250,314
Company: Centene Corp (CNC)
Centene offers high-quality healthcare, innovative programs, and a comprehensive range of health solutions to help families and people get, stay, and be healthy. The company’s distinctively local strategy, which includes local brands and teams who live in, care about, and have a direct impact on the areas they serve, is a critical differentiator in the ability to provide the members with access to exceptional care. Centene treats the full person, an approach offered locally but supported by the organization’s experience, data, and resources. Through this approach and the commitment to long-term partnerships, the company collaborates with local community organizations to achieve the purpose of improving the health of the communities that the company serves, one person at a time.
Sarah London has been the Chief Executive Officer of Centene Corporation since October 2022, a diversified healthcare organization that serves over 26 million Americans through a portfolio of government-sponsored healthcare programs aimed at the underinsured and uninsured. Before she was appointed CEO, Ms. London was the Company’s Vice Chairman, where she was in charge of a portfolio of companies independent of Centene’s health plans, designing differentiated platform capabilities, and providing industry-leading products and services to third-party customers. Ms. London earned an M.B.A. with High Honors from the University of Chicago Booth School of Business and a B.A. Magna Cum Laude in History and Literature from Harvard College, where she played Division I tennis.
Opinion: CNC is a clear election loser, but the most apparent outcomes are often discounted. I’d like to see a larger insider purchase but this raises my contrarian antennae.
Name: Albert J. Evans
Position: Director
Transaction Date: 2024-11-01 Shares Bought: 8,474 Average Price Paid: $29.50 Cost: $249,983
Company: Mid Penn Bancorp Inc (MPB)
Name: Robert A Abel
Position: Director
Transaction Date: 2024-11-01 Shares Bought: 1,500 Average Price Paid: $29.50 Cost: $44,250
Company: Mid Penn Bancorp Inc (MPB)
Name: Kimberly J Brumbaugh
Position: Director
Transaction Date: 2024-11-01 Shares Bought: 1,000 Average Price Paid: $29.50 Cost: $29,500
Company: Mid Penn Bancorp Inc (MPB)
Name: Matthew G De Soto
Position: Director
Transaction Date: 2024-11-01 Shares Bought: 18,407 Average Price Paid: $29.50 Cost: $543,007
Company: Mid Penn Bancorp Inc (MPB)
Mid Penn Bancorp, Inc. was formed in 1868 and is based in Harrisburg, Pennsylvania. The company serves as the bank holding company for Mid Penn Bank, which offers commercial banking services to individuals, partnerships, non-profit organizations, and corporations. The organization provides various time and-demand deposit products, such as checking and savings accounts, clubs, money market deposit accounts, certificates of deposit, and individual retirement accounts. It also offers a variety of lending products, including mortgage and home equity loans, secured and unsecured business and consumer loans, lines of credit, construction finance, farm loans, community development loans, loans to non-profit organizations, and local government loans. In addition, the company provides trust, retail investment, wealth management, and insurance services, as well as online banking, telephone banking, cash management, automated teller machines, and safe deposit boxes.
Mr. Albert J. Evans joined the company’s board of directors on May 19, 2023. Mr. Evans, the President of Fanelli, Evans & Patel, P.C., has 30 years of experience as a trial attorney. He is a board member of the Pennsylvania Trial Lawyers Association and is licensed to practice law in both Pennsylvania and New Jersey. He has previously served on the boards of Riverview Financial and Union Bank and Trust Company. Mr. Evans holds a bachelor’s degree from Colby College and a Juris Doctorate from Widener University School of Law. He is an active part of his community, serving as a eucharistic minister in his church, on the board of the Schuylkill YMCA, and as an official in the Schuylkill Little League.
Mr. Robert A. Abel joined Mid Penn Bancorp, Inc.’s board of directors on January 26, 2011. Mr. Robert is an Independent Director at Mid Penn Bancorp, Inc., a member of the National Association of Estate Planners & Councils, the Pennsylvania Institute of Certified Public Accountants, and the American Institute of Certified Public Accountants, as well as a Principal at Brown Plus. He serves on the Boards of Directors for Mid Penn Bancorp, Inc. and Blue & Co. LLC. Mr. Abel formerly worked as an Independent Director for Mid Penn Bank and as Chairman of the Harrisburg YMCA. He also served on the boards of ATA Holdings Corporation and Bowen Engineering Corporation. He completed his undergraduate studies at Indiana State University and Shippensburg University of Pennsylvania.
Kimberly Brumbaugh joined the Mid Penn Bancorp, Inc. board of directors in 2019. Ms. Kimberly J. Brumbaugh is an Independent Director at Mid Penn Bancorp, Inc., a Managing Partner at Brumbaugh Wealth Management LLC, and a member of the Financial Planning Association, Million Dollar Round Table, and National Association of Insurance and Financial Advisors. She serves on the Boards of Directors for Mid Penn Bancorp, Inc., Chester County Chamber of Business & Industry, Chester County Economic Development Council, and Penn Medicine Chester County Hospital Foundation. Ms. Brumbaugh previously worked as a Trustee for Chester County Hospital Foundation and a Chairman for the South Eastern Pennsylvania Autism Resource Center. She also served on the board of Mid Penn Bank.
Matthew G. DeSoto was named to the Mid Penn Bancorp, Inc. Board of Directors on January 1, 2008. Matthew DeSoto is the Eastern Division President of MI Windows & Doors, Inc., based in Gratz, PA. MI Windows and Doors, Inc. is a top ten US producer of windows and doors, with 2,500 employees nationwide. DeSoto holds a Bachelor’s Degree in Marketing from Pennsylvania State University. He is a member of the Harvard Joint Center for Housing Studies Policy Advisory Board, and volunteers, and supports Habitat for Humanity and the YMCA. DeSoto lives in Millersburg with his wife, Natalie.
Opinion: Lots of insiders buying on a secondary is not something that excites me although this is one of the best performing regional bank shares.
Name: Stadium Capital Management LLC, Stadium Capital Management GP L.P., Stadium Special Opportunity I L.P., Stadium Capital Partners L P, Seaver M Alexander
Position: 10% Owner
Transaction Date: 2024-10-31 Shares Bought: 193,813 Average Price Paid: $13.28 Cost: $2,574,452
Company: Sleep Number Corp (SNBR)
Sleep Number Corporation was founded in 1987 and is headquartered in Minneapolis, Minnesota. Sleep Number Corporation and its subsidiaries provide sleep solutions and services in the United States. Sleep Number is a company that creates, manufactures, markets, sells, and services beds, pillows, linens, and other sleeping accessories. The company also sells smart adjustable bases under the FlextFit brand and smart beds under the Climate 360 name. The company sells its products to customers directly via various channels, including retail, online, phone, and chat. The company was formerly known as Select Comfort Corporation until changing its name to Sleep Number Corporation in November 2017.
Stadium Capital Management, LLC aims to invest in the public market using a private equity approach. The company invests in a focused portfolio of smaller-cap, publicly traded companies in North America and Europe. It has a long-term investment horizon and a preference for businesses with consistent free cash flow. The company has a 25+ year history and extensive experience with numerous full market cycles.
Seaver Alexander co-founded Stadium Capital Management and served as its Managing Director in September 1997. He is on Top Corner Capital’s Advisory Committee. He was also a co-founder and partner of Seaver Kent & Company. Previously, he worked at Hambrecht & Quist. Mr. Seaver has been a Director of Diamond Brands Incorporated and Diamond Brands Operating Corporation since April 1998. He earned an M.B.A. from Stanford Graduate School of Business in 1986 and an AB in Economics from Harvard College in 1982.
Opinion: Sleep Number has a unique franchise in the luxury bed market with its adjustable firmness beds. The bedding industry has suffered a prolonged slump from high interest rates, a slow home resale market, and a pandemic hangover. When the industry comes out of hibernation, Sleep Number should rock. I usually don’t pay much attention to 10% shareholder purchases like this because hedge funds are primarily other people’s money, but a director purchased $500k in August. Also I’m a believer in buying what you know. I own a Sleep Number bed.
Name: Steven B Klinsky
Position: Director
Transaction Date: 2024-11-06 Shares Bought: 210,469 Average Price Paid: $10.94 Cost: $2,301,554
Company: New Mountain Finance Corp (NMFC)
Name: John Kline
Position: CEO, President, and Director
Transaction Date: 2024-11-06 Shares Bought: 41,550 Average Price Paid: $10.92 Cost: $453,682
Company: New Mountain Finance Corp (NMFC)
New Mountain Finance Corporation, a business development corporation, is a private equity/buyout and loan fund that invests and lends directly to middle-market companies in defensive growth industries. New Mountain Capital invests in defensive growth firms through its private equity, credit, and net lease investment methods. The Investment Adviser oversees the company’s day-to-day operations and offers investment advising and management services.
Steven B. Klinsky has been Chairman of the Board of Directors of New Mountain Finance Corporation since July 2010. Mr. Klinsky founded New Mountain Capital in 1999. Before creating New Mountain Capital, Mr. Klinsky co-founded Goldman Sachs & Co. ‘s Leverage Buyout Group. For the bulk of the 1990s, Mr. Klinsky was Forstmann Little’s most senior partner who was not a member of the family. Mr. Klinsky earned a B.A. in Economics and Political Philosophy with honors from the University of Michigan in 1976. He earned his M.B.A. from Harvard Business School and his J.D. with honors from Harvard Law School. He is or has been the chairman or director of several enterprises and philanthropies.
John Kline, Chief Executive Officer, President, and Director, joined New Mountain in December of 2008. Prior to joining New Mountain, he was an Investment Analyst and Trader for GSC Group’s distressed and corporate credit funds from 2001 to 2008. From 1999 to 2001, Mr. Kline worked at Goldman Sachs’ Credit Risk Management and Advisory Group. Mr. Kline now serves on the board of Unitek Global Services, an NMFC portfolio business. In 1999, Mr. Kline earned an A.B. degree in history from Dartmouth College.
Opinion: Based on these large insider buys, it’s safe to conclude that insiders are confident that NMFC’s ~12% yield is secure.
Name: Dennis M Weibling
Position: Director
Transaction Date: 2024-10-31 Shares Bought: 215,053 Average Price Paid: $2.20 Cost: $473,117
Company: Palladyne AI Corp. (PDYN)
Palladyne AI Corp., a software firm, specializes in supplying software that improves the utility and functionality of third-party stationary and mobile robotic systems in the United States. The company’s AI/ML software platform allows robots to observe, learn, reason, and act in structured and unstructured situations. The company’s software technology enables robotic systems to detect their surroundings and quickly adapt to new situations by generalizing their expertise through dynamic real-time operations that require minimal robot training and no substantial programming. The company supports customers in various industries, including industrial manufacturing, warehousing and logistics, defense, infrastructure maintenance and repair, energy, aerospace and aviation, etc. Palladyne AI Corp. was created in 2017 and is based in Salt Lake City, Utah.
Dennis Weibling has been a member of the Board of Directors since September 2021, and the Chairman of the Board since February 2023. Mr. Weibling joined the heritage company’s board of directors in September 2016 and served as chairman of its audit committee until the Business Combination, when he joined the board and was appointed Chairman of the Audit Committee. Mr. Weibling has served on the boards of several private firms, including Telesphere Communications Networks, Rise Communities LLC, Telecom Transport Management, Wireless Services Corporation, Worldwide Packets, Inc., Teledesic Corporation, Geopass, Inc. (d/b/a Pirq), and SeaMobile, Inc. Mr. Weibling has a Bachelor of Arts degree from Wittenberg University, a Master of Arts degree in psychology from the University of Nebraska, and a Juris Doctorate from the University of Nebraska.
Opinion: It smells like pump and dump but I’m going to do more work on this.
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Insiders sell the stock for many reasons, but they generally buy for just one – to make money. You’ve always heard the best information is inside information. Everyone with any stock market experience pays close attention to what insiders are doing. After all, who knows a business better than the people running it? Officers, directors, and 10% owners are required to inform the public through a Form 4 Filing of any transaction, buy, sell, exercise, or any other within 48 hours of doing so. This info is available for free from the SEC’s Web site, Edgar, although we subscribe to SECForm4 as they provide a way to manage and make sense of the vast realms of data. I’ve tried a lot of vendors. SECForm4 is one of the smaller ones, but I like supporting Frank. He is not arrogant. He’s helpful and has great prices. He also trades on his own data, so I like people that eat what they kill.
The bar is different from selling because the natural state of management is to be a seller. This is because most companies provide significant amounts of management compensation packages as stock and options. Therefore, we analyze unusual patterns with selling, such as insiders selling 25 percent or more of their holdings or multiple insiders selling near 52-week lows. Another red flag is large planned sale programs that start without warning. Unfortunately, the public information disclosure requirements about these programs, referred to as Rule 10b5-1, are horrendously poor. Also, planned sales that pop up out of nowhere are basically sales and are seeking cover under this corporate welfare loophole. I also generally ignore 10 percent shareholders as they tend to be OPM (other people’s money) and perhaps not the smart money on which we are trying to read the tea leaves. I say generally because some 10% shareholders are great investors. Think Warren Buffett and others
Of course, insiders can also be wrong about their Company’s prospects. Don’t let anyone fool you into believing they never make mistakes. Do your own analysis. They can easily be wrong, and in many cases, maybe most cases, have no more idea what the future may hold than you or me. In short, you can lose money following them. We have, and we curse aloud; what were they thinking!
We like Fly on the Wall for keeping up with what events might be happening, analysts’ comments, and whatever else could be moving the stock. Dow Jones news service is an essential tool, but many services pick up their feed like they do Bloomberg. For quick financial analysis, it’s hard to beat Old School Value.
A big callout to my assistant Ambreen who sets up this conversation by listing the notable buys that I’ve identified. She probes the 10k for a reasonable description of the business. I’ve found that to be the most accurate and succinct place to find out what a business actually does.
This blog is solely for educational purposes and the author’s own amusement. Think of the blog as part of my personal investment journal that I am willing to share with the DIY investor. There are also many parts that I am not willing to share if I think it could influence trading action or be detrimental to the Fund’s partners. We could be long, short, or have no position at all in any of the stocks mentioned and express no written or implied obligation to disclose any of that.
The Insiders Fund is for qualified investors and by Prospectus only. Nothing herein should be construed otherwise. THE INSIDERS FUND prefers to invest in companies at or near prices that management has been willing to invest significant amounts of their own money in, but we have no requirement to do so. We also invest in many companies in anticipation of future insider buying or with the expectation that there is none at all.
You can be an insider, too– by clicking here
Prosperous Trading,
