The officers and directors of a company tend to have a unique inside view into the business, so when these insiders make purchases, investors are wise to take notice. Presumably the only reason for a company insider to choose to take their hard-earned cash and use it to buy stock in the open market, is that they expect to make money — maybe they find the stock very undervalued, or maybe they see exciting progress within the company, or maybe both. Within the 30 components of the Dow Jones Industrial Average, only thirteen companies have experienced such buying over the trailing six month period, one of which was International Business Machines Corp. (NYSE:IBM), where an investment totaling $221.3K was made by Director David N. Farr. Click Here to Learn Which Other Twelve Dow Components Also Had Recent Insider Buying »
Farr bets big on IBM:
David N. Farr
Farr's average cost works out to $199.70/share. In trading on Wednesday, bargain hunters could buy shares of International Business Machines Corp. (NYSE:IBM) and achieve a cost basis lower than Farr, with shares changing hands as low as $198.24 per share. It should be noted that Farr has collected $0.85/share in dividends since the time of their purchase, so they are currently down 0.3% on their purchase from a total return basis. Shares of International Business Machines Corp. were changing hands at $198.66 at last check, trading up about 0.2% on Wednesday. The chart below shows the one year performance of IBM shares, versus its 200 day moving average:
Looking at the chart above, IBM's low point in its 52 week range is $157.13 per share, with $210.69 as the 52 week high point — that compares with a last trade of $198.66.
The current annualized dividend paid by International Business Machines Corp. is $3.40/share, currently paid in quarterly installments, and its most recent dividend ex-date was on 08/08/2012. Below is a long-term dividend history chart for IBM, which can be of good help in judging whether the most recent dividend with approx. 1.7% annualized yield is likely to continue.
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