Stock Quotes in this Article: NLY, SBUX, TSRA, SRPT, FES

DELAFIELD, Wis. (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.

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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.

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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 five stocks whose insiders have been doing some big buying per SEC filings.

Starbucks

One restaurant player that insiders are loading up on a large amount of stock in here is Starbucks (SBUX), which is a roaster, marketer and retailer of coffee operating in 60 countries. Insiders are buying this stock into strength, since shares are up 31% so far in 2013.

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Starbucks has a market cap of $53 billion and an enterprise value of $52 billion. This stock trades at a premium valuation, with a trailing price-to-earnings of 33.82 and a forward price-to-earnings of 26.56. Its estimated growth rate for this year is 24.6%, and for next year it's pegged at 19.3%. This is a cash-rich company, since the total cash position on its balance sheet is $2.04 billion and its total debt is $549.70 million. This stock currently sports a dividend yield of 1.2%.

A director just bought 141,573 shares, or about $9.99 million worth of stock, at $70.60 per share.

From a technical perspective, SBUX is currently trending just below its 50-day moving average and above its 200-day moving average, which is neutral trendwise. This stock has been downtrending over the last month, with shares moving lower from its high of $74.06 to its intraday low of $69.86 a share. During that move, shares of SBUX have been making mostly lower highs and lower lows, which is bearish technical price action. That said, shares of SBUX are still in a longer-term uptrend since a key uptrend line hasn't been breached.

If you're bullish on SBUX, then I would look for long-biased trades as long as this stock is trending above some key near-term support at $66.11 a share, and then once it moves back above its 50-day moving average of $71 a share high volume. Look for a sustained move or close above that level with volume that hits near or above its three-month average action of 4.48 million shares. Keep in mind that its likely SBUX pulls back below $68 a share to test that uptrend line, so that could be a good place to get long the stock.

Annaly Capital Management

Another stock that insiders are jumping into here is Annaly Capital Management (NLY), which owns, manages and finances real estate related investments. Insiders are buying this stock into notable weakness, since shares are off by 19% so far in 2013.

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Annaly Capital Management has a market cap of $10.75 billion and an enterprise value of $93.27 billion. This stock trades at a cheap valuation, with a trailing price-to-earnings of 3.27 and a forward price-to-earnings of 8.31. Its estimated growth rate for this year is 13.9%, and for next year it's pegged at -20.3%. This is not a cash-rich company, since the total cash position on its balance sheet is $3.45 billion and its total debt is a whopping $85.73 billion. This stock currently sports a dividend yield of 14%.

The CEO just bought 181,818 shares, or about $1.99 million worth of stock, at $10.96 to $10.99 per share.

From a technical perspective, NLY is currently trending above its 50-day moving average and well below its 200-day moving average, which is neutral trendwise. This stock has been downtrending badly for the last six months, with shares plunging lower from its high of $15.51 to its recent low of $10.63 a share. During that move, shares of NLY have been consistently making lower highs and lower lows, which is bearish technical price action. That said, shares of NLY have started to rebound off that $10.63 low and it's now moving within range of triggering a near-term breakout trade.

If you're in the bull camp on NLY, then look for long-biased trades as long as this stock is trending above its 50-day at $11.32 or above more near-term support at $11 and then once it breaks out above some near-term overhead resistance levels at $11.68 to $12.26 a share with high volume. Look for a sustained move or close above those levels with volume that registers near or above its three-month average action of 13.75 million shares. If that breakout triggers soon, then NLY will set up to re-test or possibly take out its next major overhead resistance levels at $12.80 to its 200-day moving average at $13.53 a share.

Tessera Technologies

One semiconductor player that insiders are snapping up a big amount of stock in here is Tessera Technologies (TSRA). Insiders are buying this stock into notable weakness, since shares are off 10.3% during the last three months.

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Tessera Technologies has a market cap of $991 million and an enterprise value of $629 million. This stock trades at a cheap valuation, with a forward price-to-earnings of 11.39. Its estimated growth rate for the next quarter is 237.5%, and for next year it's pegged at 374.6%. This is a cash-rich company, since the total cash position on its balance sheet is $380.51 million and its total debt is zero. This stock currently sports a dividend yield of 2.1%.

A director just bought 175,000 shares, or about $3.30 million worth of stock, at $18.79 per share.

From a technical perspective, TSRA is currently trending just above its 200-day moving average and right below its 50-day moving average, which is neutral trendwise. This stock has been downtrending badly for the last two months, with shares dropping from its high of $22.47 to its recent low of $18.19 a share. During that move, shares of TSRA have been consistently making lower highs and lower lows, which is bearish technical price action.

If you're bullish on TSRA, then look for long-biased trades as long as this stock is trending above $80 or above its 200-day at $18.28 and then once it moves back above its 50-day at $18.76 a share with high volume. Look for a sustained move or close above that level with volume that hits near or above its three-month average volume of 316,642 shares. If we get that move soon, then TSRA will set up to re-test or possibly take out its next major overhead resistance levels at $19.76 to $21 a share. Any high-volume move above those levels will then put its 52-week high at $22.59 into range for shares of TRSA.

Sarepta Therapeutics

Another stock that insiders are active in here is Sarepta Therapeutics (SRPT), which is focused on the discovery and development of ribonucleic acid-based therapeutics for the treatment of rare and infectious diseases. Insiders are buying this stock into major strength, since shares are up sharply by 35% so far in 2013.

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Sarepta Therapeutics has a market cap of $1.17 billion and an enterprise value of $973 million. This stock trades at a premium valuation, with a price-to-sales of 50.99 and a price-to-book of 12.40. Its estimated growth rate for this year is 36.6%, and for next year it's pegged at 12.6%. This is a cash-rich company, since the total cash position on its balance sheet is $156.18 million and its total debt is just $1.71 million.

A director just bought 3,500 shares, or about $114,000 worth of stock, at $32.68 per share.

From a technical perspective, SRPT is currently trending above both its 50-day and 200-day moving averages, which is bullish. This stock just came out of a nasty downtrend that took the stock from $47.35 to its recent low of $29.71 a share. Shares of SRPT have now entered a near-term uptrend, with the stock rebounding off that low of $29.71 and moving back above its 50-day moving average at $33.06 a share. That move has started to push SRPT within range of triggering a near-term breakout trade.

If you're bullish on SRPT, then look for long-biased trades as long as this stock is trending above its 200-day at $32.62 or above more support at $32, and then once it breaks out above some near-term overhead resistance at $35.49 a share high volume. Look for a sustained move or close above that level with volume that hits near or above its three-month average volume of 1.71 million shares. If that breakout hits, then SRPT will set up to re-test or possibly take out its next major overhead resistance levels at $39.12 to $42 a share.

Forbes Energy Services

One final name with some big insider buying is Forbes Energy Services (FES), an independent oilfield services contractor that provides a range of well site services to oil and natural gas drilling and producing companies to help develop and enhance the production of oil and natural gas. Insiders are buying this stock into big time strength, since shares are up huge by 94% so far in 2013.

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Forbes Energy Services has a market cap of $105 million and an enterprise value of $378 million. This stock trades at a reasonable valuation, with a forward price-to-earnings of 21.43. Its estimated growth rate for this year is -371.4%, and for next year it's pegged at 221.1%. This is not a cash-rich company, since the total cash position on its balance sheet is $27.19 million and its total debt is $298.82 million.

A beneficial owner just bought 224,900 shares, or about $1 million worth of stock, at $4.49 per share.

From a technical perspective, FES is currently trending above both its 50-day and 200-day moving averages, which is bullish. This stock has been uptrending strong for the last two months, with shares ripping higher from its low of $3.24 a share to its recent high of $5.31 a share. During that move, shares of FES have been making mostly higher lows and higher highs, which is bullish technical price action. That move has now pushed shares of FES within range of triggering a near-term breakout trade.

If you're bullish on FES, then look for long-biased trades as long as this stock is trending above its 50-day at $4.70 or above more support at $4 and then once it breaks out above its 52-week high at $5.31 a share with high volume. Look for a sustained move or close above that level with volume that hits near or above its three-month average action of 106,226 shares. If that breakout triggers soon, then FES will set up to enter new 52-week-high territory, which is bullish technical price action. Some possible upside targets off that breakout are its next major overhead resistance levels at $5.58 to $6.50 a share. If those levels get taken out with volume, then FES could even tag $7 to $7.20 a share.

To see more stocks with notable insider buying, check out the Stocks With Big Insider Buying portfolio on Stockpickr.

-- Written by Roberto Pedone in Delafield, Wis.


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

Roberto Pedone, based out of Delafield, Wis., 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.