At Stockpickr.com, we keep track of the Top 10 Insider Purchases and Buybacks each week. Here's the perfect setup in my mind: insiders buying the stock, the company buying back its own shares and a super investor like Warren Buffett also making a bullish bet on the stock.

If I can get three out of three, I'm in heaven. If I can get two out of three, or even one out of three, I'm still pretty happy about the situation, particularly if the stock is cheap in other ways as well.

Each Thursday we update the Stockpickr Top 10 Insider Purchases and Buybacks portfolio, featuring stocks that in recent days have had big insider purchases or newly announced buybacks, as well as super investors accumulating shares.

For instance, Exelon (EXC) is in this week's portfolio. The Chicago-based utility giant announced that it will repurchase up to $1.5 billion in common stock over the next six months. The exact timing of the repurchases will depend on market conditions.

"We have an increasingly strong cash flow profile and balance sheet, which allow us to pursue new growth opportunities and return value to our shareholders, such as through this stock buyback," said John W. Rowe, Exelon's chairman, president and CEO. "We are extremely well positioned in this uncertain market and economy, as our compelling market position supports strong long-term growth and further value creation."

In the same press release, the company tightened its 2008 earnings outlook. The company now expects full-year results of $4.15 to $4.30 a share, vs. a previous forecast of $4 to $4.40 a share. The majority of analysts are expecting Exelon to earn $4.35 a share.

Exelon reported second-quarter earnings on July 23 with a profit of $748 million, or $1.13 a share, compared with $702 million, or $1.03 a share, earned in the same period last year. The company credited the quarterly gain to higher energy margins from increased nuclear output. Profitable proprietary trading also fueled the strong quarter.

Analyst Paul B. Fremont from Jefferies upgraded Exelon to buy from hold, noting that the stock price is at a discount compared to gas price assumptions. He lowered his price target on the stock to $83 from $90 to reflect a decrease in forward gas prices. However, the new price target still represents a 29% gain from Wednesday's close.

We also like to see that Duquesne Capital is buying shares of Exelon. This $4 billion investment fund was started by Stanley Druckenmiller in 1981. Druckenmiller went to work for his hero, George Soros, in 1988 and is famous for orchestrating Soros' billion-dollar raid on the British pound in 1992. He parted from Soros in 2000 and returned to Duquesne Capital to run its No Margin Fund. The fund also holds Qualcomm (QCOM) and Monsanto (MON).

QVT Financial is another top-notch investment firm that owns Exelon. The $6 billion hedge fund was originally a successful proprietary trading group at Deutsche Bank. QVT has elected to employ a small number of highly talented generalists with elite academic backgrounds in fields ranging from physics and computer science to law. Its other top picks are SLM Corp. (SLM) and Flagstone Reinsurance (FSR).

So we have a buyback, great second-quarter earnings, an upgrade and two top-notch firms into the stock. It might be time to take a closer look at Exelon.

Next on the list is Odyssey Re Holdings (ORH). The Stamford, Conn.-based underwriter of reinsurance added $200 million to its buyback program, bringing the total authorization amount up to $600 million. The repurchases will be made from time to time depending on market conditions until the expiration date of Dec. 31, 2009.

Since the program's inception through Sept. 1, 2008, the company has repurchased 9.68 million shares, worth $354.4 million.

On July 31, 2008, the company reported dismal second-quarter results. Net income came in at $65.2 million, or $1 a share, compared with $145.5 million, or $2.02 a share, earned in the same period last year. One positive note from the earnings announcement was that the board approved a 20% increase in the quarterly dividend. Seventy-five cents a share will be paid to shareholders on Sept. 26, 2008.

Despite near-term weakness, an analyst from Wachovia Capital Markets has an outperform rating on the stock. Susan Spivak recommends buying the stock because it has strong projected book value growth and because Odyssey's diversified business mix reduces catastrophe exposure while providing stability in earnings.

Susan was pleased to see the aggressive share repurchases and increased dividend. Odyssey has repurchased more than 9% of its total outstanding common stock since the beginning of the year. She believes the company, which is up 7% on the year, should be trading in the $45-to-$47 range.

It's also good to see that an immensely successful hedge fund such as Renaissance Technologies is buying shares of Odyssey. This New York-based hedge fund was started by Jim Simmons in 1982. Its $5 billion Medallion Fund has averaged 38% annual returns, after fees, since 1989, and is considered in the industry to be the most successful hedge fund. Its other top plays are Colgate-Palmolive (CL) and El Paso (EP).

David Dreman is an investor with years of experience and astonishing returns, and he likes Odyssey. Dreman is the founder and chairman of Dreman Value Management and is also the firm's chief investment officer. The fund's Large Cap Value Fund has returned 17% annually on average, and its Small Cap Value Fund has returned 16.5% annually on average since the firm's inception in 1991. In his portfolio, you'll also find Devon Energy (DVN) and Wyeth (WYE).

So we have an increased buyback, an inflated dividend, an outperform rating and two famed traders buying shares of Odyssey. It may be time to do some more homework.

And finally, we have Gen-Probe (GPRO) making this week's list. The company announced that its board approved the repurchase of up to $250 million in common stock over the next two years. It has approximately 54.2 million shares outstanding.

Based out of San Diego, this company makes diagnostic products used to detect various infections and diseases. As of June 30, 2008, the company had $499.2 million in cash and equivalents and no debt. "Based on our healthy balance sheet and strong operating cash flows, we believe we can increase long-term shareholder value and offset dilution from employee stock programs by buying back stock," said Herm Rosenman, Gen-Probe's senior vice president and CFO.

On July 31, 2008, the company reported pretty solid second-quarter results, with product sales jumping 21% to $113.7 million from $93.9 million in the same period last year. Total revenue surged to $119.8 million from $101.3 million, an increase of 18%. It earned a profit of $24.8 million, or 45 cents a share, compared with $27 million, or 50 cents a share in the year-ago period. The lower net income can be attributed to an unusually low tax rate in the prior year period.

The company forecasts full-year EPS of $1.83 to $1.87 a share and total revenue of $467 million to $472 million.

Cowen issued a bullish report on Gen-Probe noting the FDA approval of its supplemental BLA for the Ultrio screening claim. Cowen said that US Ultrio represents one of the most important growth drivers for Gen-Probe in the 2009-2010 timeframe. It reiterated its outperform rating on the stock.

It's also good to see that a prestigious firm such as D.E. Shaw is interested in Gen-Probe stock. Since its organization in 1988, this $50 billion firm has earned an international reputation for financial innovation and an extraordinarily distinguished staff. It is also betting on Pfizer (PFE) and Microsoft (MSFT).

Another highly regarded firm that's got its money in Gen-Probe is Highbridge Capital Management. This $17 billion global hedge fund was founded in 1992. JPMorgan Asset Management formed a strategic partnership with Highbridge by purchasing a majority interest in the firm in December, 2004. Its other top picks are XTO Energy (XTO) and Electronic Arts (ERTS).

So we have a buyback, solid second-quarter earnings, a bullish report and two stellar investment firms invested in Gen-Probe. That's a nice setup for this stock to take off.

For more stocks and analysis, check out this week's Top 10 Insider Purchases and Buybacks portfolio at Stockpickr.com.

For the 10 most-recent portfolios, check out:

Top 10 Insider Purchases and Buybacks LVII

Top 10 Insider Purchases and Buybacks LVIII

Top 10 Insider Purchases and Buybacks LIX

Top 10 Insider Purchases and Buybacks LX

Top 10 Insider Purchases and Buybacks LXI

Top 10 Insider Purchases and Buybacks LXII

Top 10 Insider Purchases and Buybacks LXIII

Top 10 Insider Purchases and Buybacks LXIV

Top 10 Insider Purchases and Buybacks LXV

Top 10 Insider Purchases and Buybacks XLVI

You can also review Barron's Top Insider Purchases from the prior week and Jim Cramer's "Mad Money" Buybacks.

Posted on Sept. 10, 2008