Every investor knows that the path toward profits lies in buying low and selling high. That’s a basic precept of any economic trading system. The trick, however, is recognizing when the stock is low enough to buy in. The prime moment to buy is when the stock hits bottom; that will maximize returns when the share price starts to rise again.
There are a multitude of possible clues investors can use to find the price bottom; today, we’ll be looking at insider buying trends.
Insiders – the corporate officers, board members, and others ‘in the know’ – don’t just manage the companies, they know the details. Legally, they are not supposed to trade that knowledge, or to blatantly trade on it, and disclosure rules by government regulators help to keep the insiders honest. Their honest stock transactions, however, can be highly informative. These are the people with the deepest knowledge of particular stocks. So, when they buy or sell, especially in bulk, take note.
So let’s put this into practice. We’ve used the Insiders’ Hot Stocks tool at TipRanks to find stocks with recent ‘informative’ insider buys – and we’ve further sorted those to find three whose share price is down over 40% this year. Furthermore, these stocks have both gotten plenty of love from the Wall Street analysts. Each has a potential upside, based on analyst price targets, of more than 90%.
Iovance Biotherapeutics (IOVA)
We’ll start with a company in the medical research field, Iovance Biotherapeutics. This firm focuses on an innovative approach to cancer treatment, using tumor infiltrating lymphocyte techniques to attack malignancies. Put shortly, in layman’s terms, the company is developing a method of using the patient’s own immune system to attack tumors, through immune cells (lymphocytes) which naturally enter and attack cancerous growths.
Iovance’s pipeline is both active and varied, with an even half-dozen drug candidates at various stages of the clinical trials…
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