Insider Activity: Johnson Controls International (JCI)

Director makes quarter-million buy.

On Monday, August 26th, director Gretchen Haggerty bought 6,220 shares of Johnson Controls International (JCI). The cost came in just over $257,000, and represents a 93 percent increase in shares.

This is the first insider buy at the company since late 2017. Insiders have largely been sellers of shares at JCI year-to-date, at prices ranging from the current price to 8 percent higher, a typical pattern for a large, international company.

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  • Johnson Controls International is a diversified industrial and technology company with a focus on building technologies and solutions as well as power solutions, including heating, ventilating, control systems, fire detection and suppression, and electronic security systems among other things.

    Action to take: Trading at 15 times forward earnings, paying a 2.5 percent dividend yield, and with modest growth, the company will likely perform in line with the market. Buyers may want to consider shares under $35, a modest discount to where shares are currently trading near $42, but where shares could easily pull back to on a market decline.

    Given the company’s beta close to the market, speculators may want to consider a January 2020 $45 call, trading for around $1.00, or $100 per contract, to bet on a rally in share price, or a January 2020 $35 put option, trading around $60 per contract, as a hedge against the overall market.