Insider transaction activity can help investors generate alpha. Insiders are some of the most informed participants in the market meaning their buying and selling activity can provide valuable trading signals.

In this report, we are going to highlight some interesting insider buying at Insight Enterprises Inc (NSIT:US). Insight Enterprises is a technology company that provides solutions and services that enable customers to maximize the value of their information technology and drive digital transformation. The company is listed on the Nasdaq and currently has a market cap of approximately $4.60 billion.

Insider Buying at Insight Enterprises

2iQ data shows that several insiders at Insight Enterprises have purchased stock recently.

On February 16, Chairman Timothy Crown purchased 1,000 shares at a price of $127.32 per share. This trade cost the insider around $127,000.

Investment management company ValueAct (which is represented on the board as Activist Investor) has also been buying stock. Between February 14 and February 21, the firm bought around $11.39 million worth of NSIT stock.

Value on Offer

There are a couple of things that stand out here.

One is that the General Counsel has made a large stock purchase. Generally speaking, General Counsels tend to be quite risk averse. So, this stock purchase is notable.

Another is that ValueAct is upping its stake. So, it clearly believes the stock offers value at the moment. It’s worth noting that last year, Mason Morfit, ValueAct’s CEO and Chief Investment Officer, said that NSIT stock could climb as high as $500 in the next five years.

Earnings Growth

Insight’s recent Q4 results showed that the company is performing quite well right now.

While revenue for the period fell 2.5% year on year to $2.5 billion**, adjusted diluted earnings per share were up 25% year on year to $2.53.** This figure was well above analysts’ forecast of $2.12. Gross margin expanded 180 basis points to a record 16.8% in the fourth quarter.

“It is my pleasure to report that we ended 2022 with an outstanding fourth quarter that topped off record setting financial results for 2022,” commented President and CEO Joyce Mullen. “These results demonstrate we are making progress towards our ambition to become the leading solutions integrator and show the resilience of our business model,” she added.

On the back of these results, analysts at JP Morgan raised their price target to $140 from $125.

In light of these solid results, and the fact that the stock has a low valuation right now, we see the insider buying here as a bullish development.

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