Recent insider trends for Time Warner Inc. (NYSE:TWX) have caught the attention of investors. Analysts study insider data to get a sense of sense of what key shareholders think about the outlook for a particular stock. In the case of TWX, the data has some interesting implications for where the stock might be headed.
Institutions own 80.26% of Time Warner Inc. (TWX)’s shares. The total value of these holdings, in millions, is $64,611. Among active positions in the latest quarter, 421 holders increased their positions by a total of 53.01 million shares, 508 holders decreased the positions by a total of 55.85 million shares, and 196 holders held their positions. This works out to a net decrease in ownership of 2.83 million shares, and suggests that institutions are feeling bearish about the stock.
Among new and sold out positions, 70 holders initiated new positions by a total of 8.14 million shares and 60 holders exited their positions by a total of 5.3 million shares. This nets out to an increase of 2.85 million shares and is a bullish sign for TWX.
Insider ownership increased by a total of 0 shares, which suggests that TWX’s key executives are feeling more optimistic about the outlook for the stock. The data from the past twelve months tells a different story: insiders executed 1 buys and 13 sells, and ownership decreased by a net of 402952 shares.
The analysis of insider buying and selling trends can be extended to the aggregate level. Short interest, which represents the number of a stock’s shares currently being shorted, captures what the market as a whole feels about a stock. Time Warner Inc. (NYSE:TWX)’s short interest is 8.45 million shares, or 1.09% of the float. This represents an increase of 9% in the number of shares being shorted compared to the previous reading, and implies that investors felt more pessimistic about the stock during the past two weeks.
Supplementing insider data with technical indicators can help an investor form a more complete view on the outlook for a stock. A composite of 13 technical indicators that includes measures such as moving averages and momentum oscillators suggests that TWX is a Strong buy, which implies that TWX is expected to outperform the market based on prior trading patterns.
Institutional ownership trends suggest that the stock is cheap and the insider trading data indicates that insiders are bullish. Technical indicators (also) suggest that Time Warner Inc. (NYSE:TWX) is undervalued.