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Land This Bargain Even Cheaper Than Director Daley Did

By Dividend Channel Staff, Thursday, December 20, 10:07 AM ET
Play Video: One Reason For Insiders to Buy


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There's an old saying on Wall Street about insider buying: there are many possible reasons to sell a stock, but only one reason to buy. Back on October 23, Coca-Cola Co 's Director, Richard M. Daley, invested $36,699.20 into 1,000 shares of KO, for a cost per share of $36.70. Bargain hunters tend to pay particular attention to insider buys like this one, because presumably the only reason an insider would take their hard-earned cash and use it to buy stock of their company in the open market, is that they expect to make money.

In trading on Thursday, bargain hunters could buy shares of Coca-Cola Co (NYSE:KO) and achieve a cost basis even cheaper than Daley, with shares changing hands as low as $36.68 per share. It should be noted that Daley has collected $0.26/share in dividends since the time of their purchase, so they are currently up 0.7% on their purchase from a total return basis. Coca-Cola Co shares are currently trading up about 0.3% on the day. The chart below shows the one year performance of KO shares, versus its 200 day moving average:

Coca-Cola Co  Chart

Looking at the chart above, KO's low point in its 52 week range is $33.28 per share, with $40.67 as the 52 week high point that compares with a last trade of $36.92. By comparison, below is a table showing the prices at which insider buying was recorded over the last six months:

Purchased Insider Title Shares Price/Share Value
10/23/2012 Richard M. Daley Director 1,000 $36.70 $36,699.20

The current annualized dividend paid by Coca-Cola Co is $1.02/share, currently paid in quarterly installments, and its most recent dividend ex-date was on 11/28/2012. Below is a long-term dividend history chart for KO, which can be of good help in judging whether the most recent dividend with approx. 2.8% annualized yield is likely to continue.

According to the ETF Finder at ETF Channel, KO makes up 11.91% of the Consumer Staples Select Sector SPDR Fund ETF (AMEX:XLP) which is trading up by about 0.3% on the day Thursday.

See what other ETFs contain KO
See what other stocks are held by XLP


Special Offer: Find out how Dave Moenning is trading around the most recent insider transactions with a free 30 day trial .


This Article's Word Cloud:   Below   Buying   Coca   Cola   Daley   Definition   Director   ETFs   Earnings   Fund   Importance   Insider   Price   Richard   Thursday   about   annualized   basis   below   buying   chart   comparison   cost   currently   dividend   escape   fillColor   hunters   insider   last   most   only   other   paid   point   purchase   reason   recent   recorded   share   shares   stock   that   their   they   trading   week   what   which   with

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