David Smith, a director at Illinois Tool Works (ITW), recently added 1,390 shares. The buy increased his holdings by 0.4 percent, and came to a total cost just over $308,000.
This is the first buy from company insiders in just over a year, when another director bought 10,000 shares. Otherwise, company executives have been regular and steady sellers of the stock going back over the past three years.
Overall, company insiders own 0.3 percent of shares.
The industrial machinery manufacturer has seen shares drop about 7 percent in the past year, outperforming the overall stock market. And the company has performed even better operationally, with revenue and earnings both up about 13 percent.
Action to take: Investors may like shares here, with an eye towards adding to that stake on a down day for markets.
Besides the steady operational performance, the company is a dividend growth stock. The current yield is about 2.4 percent, with room for future growth.
And with a $500 million quarterly stock buyback in place, shares are likely to continue gradually outperforming the stock market over time, even with the considerable amount of exercised stock options by company executives.
For traders, the June 2023 $250 calls, last going for about $7.20, offer mid-double-digit returns on a move higher in shares.
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.