Carl Icahn and John Malone Among Insiders Building Stakes in the Bear Market

Increased volatility and markets in or near bear territory has not deterred some insider buyers from continuing to build their stakes in their favorite stocks. Among those are beneficial owners such as legendary investor Carl Icahn and billionaire John Malone. An outgoing CEO also acquired more shares and is a beneficial owner as well.

Let’s take a quick look at these notable transactions of the past week or so.

Is Insider Buying Important?

A well-known adage reminds us that corporate insiders and 10% owners really only buy shares of a company because they believe the stock price will rise and they want to profit from it. Thus, insider buying can be an encouraging signal for potential investors. This is all the more so during times of uncertainty in the markets, and even when markets are near all-time highs.

Note that the first-quarter earnings-reporting season has begun, and many insiders are prohibited from buying or selling shares. Below are some of the most notable insider purchases that were reported recently, starting with the largest and most prominent.

CVR Energy

• Buyer(s): 10% owner Carl Icahn
• Total shares: about 1.1 million
• Price per share: $16.62 to $18.18
• Total cost: more than $18.8 million

This renowned American financier and investor has been on a buying spree for the past month or so and now has a CVR Energy Inc. (NYSE: CVI) stake of around 70.2 million shares.

This Texas-based refiner is scheduled to post first-quarter results next week, and it reported a smaller-than-expected net loss for the fourth quarter. Revenue exceeded Wall Street estimates as well. The stock was last seen trading above the purchase price range above. Analysts anticipate only fractional upside in the next year to their consensus target price of $18.50. But none of them recommend buying shares.

Note that Icahn also has been building a stake in fertilizer maker CVR Partners (see below).

Asana

• Buyer(s): CEO Dustin Moskovitz
• Total shares: around 575,500
• Price per share: $13.48 to $15.94
• Total cost: almost $8.7 million

With its most recent earnings report, San Francisco-based Asana Inc. (NYSE: ASAN) also announced Moskovitz’s retirement. The share price plunged afterward and has yet to recover. The share price is about the same as a month ago. A year ago, the price was 5.8% higher than the current price, which is within the buyer’s purchase price range.

Analysts see 7.5% upside in the coming year, given their $15.44 consensus target price. Out of 19 analysts who cover the stock, only five of them recommend buying shares. J.P. Morgan reiterated its Underweight rating last month, and Morgan Stanley just maintained an Equal Weight rating.

Note that the outgoing chief executive bucked the trend, beginning to build his stake while two officers and a director were selling shares.

Lions Gate Entertainment

• Buyer(s): 10% owner Liberty 77 Capital
• Total shares: more than 1.2 million
• Price per share: $6.76 to $6.90
• Total cost: almost $8.4 million

This same buyer has been scooping up Lions Gate Entertainment Corp. (NYSE: LGF-B) shares, both A shares and B shares, since last June. After the transaction above, its B-share stake is up to more than 10.6 million shares.

The motion picture and television producer and distributor’s most recent quarterly results exceeded Wall Street estimates, due in part to record earnings from licensing. The share price is 1.3% higher than when the report was posted but down 3.2% year to date. It was last seen above the purchase price range above.

Analysts anticipate 46.2% upside in the coming year to their consensus price target of $10.67. Note that the highest price target is up at $15. The consensus recommendation of those analysts is to buy shares.

Atlanta Braves

• Buyer(s): 10% owner John Malone
• Total shares: almost 147,400
• Price per share: $39.51 to $42.00
• Total cost: over $6.0 million

This billionaire businessman and television personality also acquired almost $1.4 million worth of Atlanta Braves Holdings Inc. (NASDAQ: BATRA) shares in March. His stake is now up to more than 363,300 shares.

CNBC’s Jim Cramer also is a big fan of this Las Vegas-based casino resort operator, and its fourth-quarter results exceeded Wall Street expectations on the top and bottom lines. After the report, the stock surged, but with the market chaos since, the share price is down 1.9% since the report. But the stock is up 4.7% year to date.

Analysts no longer have a consensus recommendation or price target for the A shares. However, for the C shares, Atlanta Braves Holdings Inc. (NASDAQ: BATRK), which are non-voting shares, three of four analysts recommend buying shares.

CVR Partners

• Buyer(s): 10% owner Carl Icahn
• Total shares: over 42,300
• Price per share: $68.12 to $74.55
• Total cost: around $3.0 million

Carl Icahn has also been scooping up shares of this Sugar Land, Texas-based fertilizer maker since last November. His CVR Partners L.P. (NYSE: UAN) stake is now up to more than 261,900 shares.

Its first-quarter earnings report is scheduled for next week. The fourth-quarter bottom-line results exceeded Wall Street estimates, and the company projected strong demand for nitrogen fertilizer this spring. The stock fell afterward but has mostly recovered. Shares were last seen a little above the purchase price range above, despite being down marginally year to date.

Here too, analysts have no consensus recommendation or price target. Shares have changed hands for between $62.94 and $88.94 apiece in the past year.

And Other Insider Buying

In the past week or so, some insider buying was reported at Agree Realty, Construction Partners, Cracker Barrel Old Country Store, Dollar Tree, GameStop, and Goldman Sachs.

Stock Splits Matter: Here’s What’s Coming Up Soon

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