Joel Wilentz, a director at Universal Insurance Holdings (UVE), recently picked up 3,200 shares. The buy increased his holdings by 1.3 percent, and came to a total cost just under $30,000.
He was joined by another director who bought 2,500 shares on the same day, paying just under $24,000. That director increased his holdings by 18 percent. Over the past three years, insider buys have been far greater than insider sales, but most of those buys occurred 2-3 years ago.
Overall, company insiders own 10.1 percent of shares.
The property and casualty insurance company has lost about 25 percent of its value in the past year. And with a major hurricane making landfall last week, shares dipped even lower, but have since trended higher in the past few days.
Action to take: Property insurance companies will likely fare better as the full damage from the latest hurricane season is calculated. At present, however, the company trades at about one-fourth its price-to-sales ratio, and for about a 20 percent discount to its book value, indicating a value investment opportunity here.
Plus, shares pay a dividend yield of about 6.2 percent at current prices.
For traders, shares are likely to trend higher with the end of hurricane season in the coming months. The February $12.50 calls, last going for about $0.35, could deliver mid-to-high double-digit returns in the coming months on such a move.
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.