Key Points
- Salesforce.com's major shareholder, ValueAct, upped its stake in a sign of confidence in the business.
- Identiv insiders buy the stock, but the signal is not as bullish as it sounds.
- Steel Connect's largest shareholder continues to buy, leading this market to break out of its trading range.
The tech sector is hot and leading the broad market to new highs. The problem for investors is that gains aren’t spread equally across industries or companies within industries, making it a stock-pickers market. One way to find good investments versus bad ones is to follow the money. In this case, the money belongs to insiders, including executives, major shareholders, and institutions. This is a look at the three hottest tech stock buys according to InsiderTrades.com data ranked by dollar value, the number of insiders buying, and the number of transactions.
Salesforce.com Insider Sinks $100,000,000 Into CRM Stock
Salesforce.com's (NYSE: CRM) major shareholder, ValueAct, sank nearly $100,000 million into CRM stock shortly after the Q1 earnings release. The move is viewed as a vote of confidence by the activist investor, who took advantage of the 15% drop in price caused by the results. ValueAct owns about 4% of this tightly-held issue, is far from the largest holder, and is not the only institution buying this stock. It is the largest holder with a recent transaction; non-major shareholder activity is bullish on balance in the year’s first half and may pick up with the stock trading near six-month lows.
The caveat is that insiders and analysts do not support the market in June. Insiders are weighing on the market, including directors, a co-founder, and numerous sales by CEO Marc Benioff and other c-suite execs. That and significant analyst price target reductions will provide a headwind over the summer. Enough analysts lowered their targets after the Q1 release to put the stock high on the list of most downgraded names. That is a headwind, but the stock may be trading near the price floor. The analysts lowered their targets, but the low-end remained firm near the current price action. The consensus is down from its peak but up compared to last year, and it is 25% above the current action, suggesting a rebound is possible later in the year.
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Identiv Insiders Buy, Buy, Buy After Q1 Results
Identiv’s (NASDAQ: INVE) Q1 results weren’t awesome, with revenue contracting by double-digits and negative earnings, but the insiders bought stock anyway. Insiders, including the CEO and a director, made multiple stock purchases, but the buys may be related to vesting or stock options. The last purchases by insiders were conspicuously made following the Q1 results in 2023.
Institutional holdings equate to 65% of the stock and may help support the market. Institutions bought on balance for four consecutive quarters until Q2 2024. The balance of activity in Q2 is net-bearish but also the lowest activity level in years. Two analysts rate this stock at Buy, so there is market interest. Their most recent updates are in 2024 but came out before the Q1 release. They view the stock as undervalued and trading 50% below the low end of their expected range. The largest shareholder of the stock is Bleichroeder LP, a private investment firm located in New York City.
Steel Connect About to Connect With a New High
Steel Connect (NASDAQ: STCN) investors have been on a wild ride the last few years as supply chain issues drove business, and a takeover bid (yet to be completed) drove volatility. Now, the business is on track to return to growth after years of industry volatility and normalization, and it is making money.
Among the drivers for price action is insider buying, driven by activist investors. Steel Partners Holdings is buying up the stock and appears set on gaining control. Steel Partners Holdings is a holding company for a diversified portfolio of businesses, including supply chain management and logistics; Steel Connect is a perfect fit. Steel Partners owns nearly 30% of the stock.
No analysts rate this stock, and the institutional activity is light. However light, institutional activity is net-bullish in 2024 and has total interest up to 45%. The buying coincides with bullish price action; the stock trades within a range but shows rising support and is on the brink of breaking out. The critical resistance level is near $12.65 and may be broken soon.
Companies in This Article:
| Company | Current Price | Price Change | Dividend Yield | P/E Ratio | Consensus Rating | Consensus Price Target |
|---|
| Steel Connect (STCN) | $12.50 | +1.3% | N/A | 4.07 | N/A | N/A |
| Identiv (INVE) | $3.70 | +1.6% | N/A | 1.21 | Buy | $7.25 |
| Salesforce (CRM) | $343.65 | +2.2% | 0.47% | 56.52 | Moderate Buy | $378.86 |
Experience
Thomas Hughes has been a contributing writer for InsiderTrades.com since 2019.
Areas of Expertise
Technical analysis, the S&P 500; retail, consumer, consumer staples, dividends, high-yield, small caps, technology, economic data, oil, cryptocurrencies
Education
Associate of Arts in Culinary Technology
Past Experience
Market watcher, trader and investor for numerous websites. Founded Passive Market Intelligence LLC to provide market research insights.
