Insider Activity: Universal Insurance (UVE)

CEO a repeat buyer of shares near current prices.

On June 14th, CEO Sean Downes picked up 3,000 shares of his company, Universal Insurance (UVE).

But this isn’t his first buy in recent weeks. On June 11th, he picked up 2,500 shares. And on May 28th, he picked up 10,000 shares, all right around current prices.

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  • Overall, he has increased his stake slightly to 1.43 million shares.

    Universal Insurance is an integrated holding company that offers residential homeowner’s insurance, renter’s fire, as well as other policies as well.

    With a focus on high return on equity and solid underwriting, shares have done very well over the last 5-10 years, although they have been prone to large pullbacks.

    It’s easy to see why the CEO is upping his stake here. Shares have slid roughly 50 percent since last September on sluggish earnings and increased insurance claims. Nevertheless, the company remains profitable and growing.

    Action to take: At current prices, and with a 2 percent dividend yield, compelling valuation, and share buyback program in place, a buy here with a long-term view would likely generate market-beating returns to investors.

    The short term, particularly with the summer hurricane season, could be a bit more volatile, however.

    Buy shares under $30, with an eye towards adding more shares on a big down day for the stock.