Steven Black, a director at
Nasdaq (NDAQ), recently picked up 4,000 shares. The buy increased his holdings by 3 percent, and came to a total cost of $205,840.
This is the first insider buy at the company in over two years. Rather, company insiders have been regular and steady sellers of shares in low-six-digit amounts over the past two years, particularly at the executive vice president level.
Overall, insiders own 18.9 percent of the financial exchange firm.
Shares have traded flat over the past year. Last year’s bear market cut down on trading activity, and even with this year’s bull market, revenues are flat at best. Earnings are only up about 6 percent overall as a result.
Action to take: Financial exchanges are an oligopoly business, which should bode well for the company over time. Long-term investors might consider shares on a drop under $50, as shares are at the low end of their valuation rate at about 19 times forward earnings.
Plus, at current prices, shares yield about 1.7 percent, and the dividend has a history of going up over time.
For traders, shares are in a downtrend, and near a 52-week low. The December $45 puts, last going for about $1.10, could see mid-double-digit returns in the coming months on a continued slide in shares. Traders should take profits on a down day and look to trade a counter-rally higher.
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.