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Top Insider Trades: Berkshire Continues Buying DaVita


A secondary offering triggered a CytRx buy while a Cracker Barrel insider cashes in ahead of a potential showdown with Biglari Holdings.

In a victory for common sense, the trading behavior of company executives, directors, and large shareholders in the stocks of firms they're registered "insiders" at have been proven profitable to monitor by both academic studies and (more importantly) the experience of your fellow professional investors.

Below are lists of the top 10 mainly open-market insider purchases and sales filed at the Securities and Exchange Commission Thursday, October 18, 2012 as ranked by dollar value.

Please note, however, that these are factual lists, not buy and sell recommendations. Dollar value is only one metric to assess the importance of an insider transaction, and, frankly, often not even the most important metric that determines if an insider transaction is significant.

Berkshire Hathaway (NYSE:BRK.A) made a $7 million stock purchase in DaVita (NYSE:DVA) bringing its total investment over the past 30 days in the dialysis provider to $67 million. Another beneficial owner who has made a reappearance as a purchaser is Scott Patterson of CytRx (NASDAQ:CYTR) whose recent purchase of 1.2 million shares (worth $3 million) during a secondary offering brings his total holdings to 4.3 million shares, worth $10.75 million at yesterday's closing price. Meanwhile, the stock closed at $2.50 per share, down nearly 20%, on a traded volume of 3.30 million shares. The current offering is expected to gross proceeds of about $20 million.

Cracker Barrel (NASDAQ:CBRL) insider Michael Woodhouse continues to unload stock; this time, he sells $4.4 million worth of the restaurant chain. That brings his total sale during October to nearly $12 million. For the past year, the management of Cracker Barrel has been locking horns with Sardar Biglari whose firm, Biglari Holdings (NYSE:BH), holds a 17.5% stake in the company, making him the largest shareholder. Biglari has repeatedly criticized the company's performance as well as its leadership. Biglari Holdings has been lobbying for a seat on the company's board. Although it wasn't successful last year in the effort, there is a shareholder meeting scheduled for November 15. For its part, Cracker Barrel accuses the holding company of trying to take control of the chain without paying shareholders a premium.

Also, according to SEC filings, Garmin (NASDAQ:GRMN) CEO Min Kao sold $1.6 million in the GPS maker while the COO of J.B. Hunt Transport (NASDAQ:JBHT) sold $1.5 million in the transportation firm's stock. Interestingly, options plays on both companies show that at least some investors are betting on significant growth at the firms.

At, we find new investment ideas just about every day using these and more intricate insider screens to determine where we should focus our subsequent fundamental and technical analysis. And while stocks don't (or shouldn't) move up or down based on insider activity alone, insiders tend to be good indicators of when real stock-moving events like earnings surprises, corporate actions, and new products may be in the offing.

Source: | Key to Insider Title and Trans Type Codes

Source: | Key to Insider Title and Trans Type Codes

Editor's note: Jonathan Moreland is the founder of Insider Insights and author of "Profit From Legal Insider Trading."
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