Paul Donahue, CEO at Genuine Parts Company (GPC), recently bought 1,600 shares. The buy increased his holdings by 1 percent, and came to a total cost of $249,728.
This is the first buy at the company in over a year. Last year, one director bought over 1,600 shares, paying just over $200,000, on two separate occasions. Over the past two years, there has been only one insider sale.
All told, insiders at the auto parts retailer own 0.3 percent of shares.
A slowing market for new car sales has led to longer road life for existing cars, which has fared well for GPC. Shares are up nearly 30 percent over the past year, even with earnings dipping by nearly 2 percent.
Shares trade at about 19 times forward earnings, and at about 1.1 times their sales, indicating that there could be more upside potential if conditions continue to favor the auto parts industry.
Action to take: Shares yield about 2.4 percent here, slightly better than the S&P 500’s return. The stock has pulled back in the past few months, but appears to be trending higher once again.
For traders, the August $180 calls, last going for about $4.35, offer mid-double-digit gains on a rebound in shares in the coming months, which would likely coincide with the start of the summer driving season.
Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any of the companies mentioned in this article.