Insider Activity: Sally Beauty Holdings (SBH)

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  • Insiders are picking up shares at the cosmetics company.

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  • Multiple insiders at Sally Beauty Holdings (SBH) have been adding shares in recent days.

    Chairman of the Board Robert McMaster picked up 5,000 shares, shelling out over $73,000 of his own money to add to his take.

    CFO Aaron Alt bought 1,500 shares, paying over $22,000 to add to the cosmetic supply company.

    On top of that, CEO Christian Brickman bought 5,000 shares for nearly $75,000 as well.

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  • This is a nice cluster of corporate insiders. The CEO, Chairman and CFO are typically the best informed about a company and its future prospects. When corporate insiders put their own money at work in shares, they see an undervaluation.

    With shares of Sally Beauty having traded as high as $23.60 in the past year, shares look attractive here under $16. And on a valuation basis, shares trade at just 7 times earnings.

    With a modest $1.8 billion market cap, the company could also be a buyout target from another beauty supply store or cosmetics company looking to improve its supply chain.

    Action to take: Shares of Sally Beauty Supply (SBH) are a buy up to $16, with a target sale price of $20 in the coming months. That could be even higher if a buyout offer materializes or some other news event that sends shares spiking higher.

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