Stock Quotes in this Article: HMA, MNKD, SNTS, SPB, UTHR

WINDERMERE, Fla. (Stockpickr) -- Corporate insiders sell their own companies' stock for a number of reasons.

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They might need the cash for a big personal purchase such as a new house or yacht, or they might need the cash to fund a charity. Sometimes they sell as part of a planned selling program that they have put in place for diversification purposes, which allows them to sell stock in stages instead of selling all at one price.

Other times they sell because they think their stock is overvalued and the risk/reward is no longer attractive. Some even dump their own stock because they have inside knowledge that a competitor is eating their lunch and stealing market share.

But insiders usually buy their own shares for one reason: They think the stock is a bargain and has tremendous upside.

The key word in that last statement is "think." Just because a corporate insider thinks his or her stock is going to trade higher, that doesn't mean it will play out that way. Insiders can have all the conviction in the world that their stock is a buy, but if the market doesn't agree with them, the stock could end up going nowhere. Also, I say "usually" because sometimes insiders are loaned money by the company to buy their own stock. Those loans are often sweetheart deals and shouldn't be viewed as organic insider buying.

At the end of the day, its large institutional money managers running big mutual funds and hedge funds that drive stock prices, not insiders. That said, many of these savvy stock operators will follow insider buying activity when they agree with the insider that the stock is undervalued and has upside potential. This is why it's so important to always be monitoring insider activity, but it's twice as important to make sure the trend of the stock coincides with the insider buying.

Recently, a number of companies' corporate insiders have bought large amounts of stock. These insiders are finding some value in the market, which warrants a closer look at these stocks. Here's a look at some stocks where insiders have been doing some big buying in per SEC filings.

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Spectrum Brands

One consumer products player that insiders are loading up on here is Spectrum Brands (SPB). This company has market positions in six product categories: consumer batteries, pet supplies, electric shaving & grooming, electric personal care, portable lighting & home and garden control products. Insiders are buying this stock into strength, since shares are up a whopping 60% in 2012.

Spectrum Brands has a market cap of $2.26 billion and an enterprise value of $3.78 billion. This stock trades at a premium valuation, with a trailing price-to-earnings of 48.24 and a forward price-to-earnings of 12.26. Its estimated growth rate for this year is 52.6%, and for next year it's pegged at 2.9%. This is not a cash-rich company, since the total cash position on its balance sheet is $157.96 million and its total debt is $1.67 billion.

A beneficial owner just bought 333,778 shares, or about $14.99 million worth of stock, at $44.94 per share.

From a technical perspective, SPB is currently trending above its 200-day moving average and just below its 50-day moving average, which is neutral trendwise. This stock recently formed a double top at around $48.22 to $48.36 a share, and then subsequently sold off to a low of $42.19 a share. Following that selloff, shares of SPB have started to bounce off that recent low of $42.19 a share and its moving within range of triggering a near-term breakout trade.

If you're bullish on SPB, then I would look for long-biased trades if this stock manages to break out back above its 50-day moving average of $45.53 a share with high volume. Look for a sustained move or close above $45.53 a share with volume that hits near or above its three-month average action of 279,390 shares. If that breakout triggers soon, then SPB will set up to re-test or possibly take out those double top resistance areas near $48.22 to $48.36 a share. Keep in mind that any move above $48.36 would then push SPB into new 52-week high territory, which is bullish technical price action.

United Therapeutics

Another name in the biotechnology and drugs complex that insiders are loading up on here is United Therapeutics (UTHR). This company is focused on the development and commercialization of products to address the medical needs of patients with chronic and life-threatening conditions. Insiders are buying this stock into some modest strength, since shares are up 10% in 2012.

United Therapeutics has a market cap of $2.65 billion and an enterprise value of $2.44 billion. This stock trades at a cheap valuation, with a trailing price-to-earnings of 10.50 and a forward price-to-earnings of 9.46. Its estimated growth rate for this year is 44.5%, and for next year it's pegged at 4.3%. This is a cash-rich company, since the total cash position on its balance sheet is $503.46 million and its total debt is $273.37 million. After you back out the debt, this company has a net cash position of $230.09 million.

The CEO just bought 9,000 shares, or about $466,000 worth of stock, at $51.44 to $52.12 per share.

From a technical perspective, UTHR is currently trending above both its 50-day and 200-day moving averages, which is bullish. This stock recently bounced right off its 200-day at $50.06 a share and back above its 50-day at $51.28 a share. That bounce is quickly pushing shares of UTHR within range of triggering a near-term breakout trade.

If you're in the bull camp on UTHR, then I would look for long-biased if this stock manages to break out above some near-term overhead resistance levels at $53.48 to $54.23 a share with high volume. Look for a sustained move or close above those levels with volume that hits near or above its three-month average action of 771,969 shares. If that breakout triggers soon, then UTHR will set up to re-test or possibly take out its next major overhead resistance levels $58.38 to $59 a share. Any move above $59 will then push UTHR into new 52-week high territory, which is bullish technical price action.

Mannkind

Yet another name in the biotechnology and drugs complex that insiders are snapping up a huge amount of stock in is Mannkind (MKND). This company is focused on the discovery, development and commercialization of therapeutic products for diseases such as diabetes and cancer. Insiders are buying this stock into weakness, since shares are down by 20% in the last three months.

Mannkind has a market cap of $451 million and an enterprise value of $872 million. Its estimated growth rate for this year is 33.3%, and for next year it's pegged at 48.9%. This is not a cash-rich company, since the total cash position on its balance sheet is $2.12 million and its total debt is $434.82 million.

The CEO and chairman of the board just bought 40,000,000 shares, or about $103.6 million worth of stock, at $2.59 per share.

From a technical perspective, MNKD is currently trending above both its 50-day and 200-day moving averages, which is bullish. This stock has been uptrending strongly for the last two months, with shares moving higher from a low of $1.82 to its recent high of $2.28 a share.

During that uptrend, shares of MNKD have been consistently making higher lows and higher highs, which is bullish technical price action. That move has now pushed MNKD within range of triggering a major breakout trade.

If you‘re bullish on MNKD, then I would look for long-biased trades if this stock manages to break out above some near-term overhead resistance at $2.28 a share with high volume. Look for a sustained move or close above $2.28 a share with volume that registers near or above its three-month average action of 2,607,240 shares. If that breakout triggers soon, then MNKD will set up to re-fill some of its previous gap down zone from October that started at $2.67 a share. Any high-volume move above $2.67 will then put $2.88 to $2.94 into focus for shares of MNKD.

Santarus

One specialty pharmaceutical player that insiders are jumping into here is Santarus (SNTS). This company is focused on acquiring, developing and commercializing proprietary products that address the needs of patients treated by gastroenterologists and other targeted physicians. Insiders are buying this stock into notable strength, since shares are up by 54% during the last six months.

Santarus has a market cap of $685 million and an enterprise value $625 million. This stock trades at a reasonable valuation, with a trailing price-to-earnings of 48.92 and a forward price-to-earnings of 14.29. Its estimated growth rate for this year is 200%, and for next year it's pegged at 261.9%. This is a cash-rich company, since the total cash position on its balance sheet is $81.93 million and its total debt is $9.86 million.

A director just bought 185,000 shares, or around $2.01 million worth of stock, at $10.88 per share.

From a technical perspective, SNTS is currently trending above both its 50-day and 200-day moving averages, which is bullish. This stock has been uptrending strongly for the last five months, with shares soaring from a low of $4.82 to its recent high of $11.76 a share. During that uptrend, shares of SNTS have been consistently making higher lows and higher highs, which is bullish technical price action. That move has now pushed SNTS within range of triggering a major breakout trade.

If you're in the bull camp on SNTS, then I would look for long-biased trades if this stock manages to break out above some near-term overhead resistance at $11.76 a share with high volume. Look for a sustained move or close above $11.76 a share with volume that registers near or above its three-month average action of 779,339 shares. If that breakout triggers soon, then SNTS will set up to enter new 52-week high territory, which is bullish technical price action.

Traders can also look to buy SNTS off any pullback that pushes the stock back towards its 50-day at $9.70 a share to anticipate that breakout.

Health Management Associates

The last name to consider with some huge insider buying is healthcare facilities player Health Management Associates (HMA). This company provides health care services to patients in owned and leased facilities located mainly in non-urban communities in the southeastern and southwestern United States. Insiders are buying this stock into strength, since shares are up 37% during the last six months.

Health Management Associates has a market cap of $2.36 billion and an enterprise value of $5.84 billion. This stock trades at a cheap valuation, with a trailing price-to-earnings of 16.09 and a forward price-to-earnings of 10.36. Its estimated growth rate for this year is -5.7%, and for next year it's pegged at 8.5%. This is not a cash-rich company, since the total cash position on its balance sheet is $181.79 million and its total debt is $3.68 billion.

A beneficial owner just bought 4,980,227 shares, or about $45.62 million worth of stock, at $9 to $9.19 per share.

From a technical perspective, HMA is currently trending well above both its 50-day and 200-day moving averages, which is bullish. This stock recently spiked big right off its 200-day moving average of $7.35 a share. Following that spike, shares of HMA went on to soar to its recent high of $9.32 a share in just a few weeks.

If you're bullish on HMA, then I would look for long-biased if this stock manages to break out above some near-term overhead resistance $9.32 a share with high volume. Look for a sustained move or close above $9.32 a share with volume that hits near or above its three-month average action of 4,718,430 shares. If that breakout triggers soon, then HMA will set up to enter new 52-week high territory, which is bullish technical price action. Traders can also look to buy HMA off weakness on any move back towards its 50-day at $7.92 a share to anticipate that breakout.

To see more stocks with notable insider buying like Liberty Media (LMCA), Ceres (CERE) and Resolute Forest Products (RFP), check out theStocks With Big Insider Buying portfolio on Stockpickr.

-- Written by Roberto Pedone in Winderemere, Fla.

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At the time of publication, author had no positions in stocks mentioned.

Roberto Pedone, based out of Windermere, Fla., is an independent trader who focuses on technical analysis for small- and large-cap stocks, options, futures, commodities and currencies. Roberto studied international business at the Milwaukee School of Engineering, and he spent a year overseas studying business in Lubeck, Germany. His work has appeared on financial outlets including CNBC.com and Forbes.com. You can follow Pedone on Twitter at www.twitter.com/zerosum24 or @zerosum24.