Key Points
- Insiders are selling shares of Fastenal, Intuitive Surgical and Netflix, but investors should focus on the rally, not the insiders.
- Stock rallies are driven by performance, growth, cash flow and analyst revision trends.
- These upward trends are projected to continue into 2025.
Insiders are selling stocks on the rise such as Fastenal (NASDAQ: FAST), Intuitive Surgery (NASDAQ: ISRG) And Netflix (NASDAQ: NFLX) but investors should do the opposite. Investors should buy these stocks because the companies they represent are growing their businesses, exceeding expectations, and have strong 2025 prospects to support the upward trend in their stock prices. Each of these stocks has seen double-digit growth over the past year, with further growth expected in 2025.
Fastenal will switch in 2025
Thanks to diversification, Fastenal’s revenue growth slowed to almost 0% and then began to accelerate. Strength in non-core segments offsets weakness in fasteners as industries including automotive original equipment manufacturers (OEMs) turn to maintenance while production levels are low. The takeaway is that growth has accelerated sequentially and is projected to accelerate in 2025, with revenue projected at 7.75% by analyst consensus estimates and earnings growing slightly faster.
Insider selling has been active this year, reaching long-term highs in the fourth quarter. However, given that ten insiders have made 12 transactions in the last 90 days and the sales are small, this activity is consistent with stock-based compensation and does not raise any red flags. Even without factoring stock-based compensation into the equation, the share price is trading at record levels and offering attractive returns for long-term holders, including insiders. Conversely, in 2024, institutions bought on balance sheet, driving the market higher. They own about 85% of the shares, and analyst sentiment also helps.
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InsiderTrades tracks ten analysts who have a relatively strong Hold rating, with 80% having a Hold rating or better. The consensus price target lagged the market’s performance in mid-November, but is up 30% over the past year and has risen since its last earnings report. The revision trend suggests a move into the upper range is possible, with potential for another 5% upside from $82.50.
Intuitive Surgery: Intuitive Buying for Growth Investors
Intuitive Surgical is a leading player in the medical technology market with its da Vinci surgical systems. AI-enabled robotic systems enable less invasive surgeries with better results and are gaining popularity in the healthcare industry. Highlights from the latest report expand on trends that include an increase in the installed base as well as growth in the number of installed locations. The incentives are driven by increasing penetration in the communities in which they are located and an increase in the number of approved procedures. The critical detail for investors is that the growing revenue base provides significant recurring revenue for the tool business and sustainable cash flow.
InsiderTrades tracks eight insiders who made 16 transactions in the last 90 days. Insiders who are involved in sales include directors, executive vice presidents, senior vice presidents, general manager and general counsel. As with Fastenal, the sales coincide with executives receiving stock-based compensation, which isn’t a red flag. The company’s shares are up nearly 40% this year, more than doubling the lows set at the end of 2022.
Netflix insiders are selling: shares are at record highs
Netflix insiders are selling their shares because they are rising and setting all-time highs. Their performance is less of a concern than Fastenal or Intuitive Surgical, despite a list of insider sellers that includes Chairman Reed Hastings and other critical insiders. Highlights for 2024 include higher-than-expected user growth and leveraged revenue and earnings growth.
The growth is driven by expanding territory and deeper penetration, fueled by stricter password sharing policies and new ad-supported tiers. Growth is expected to remain at a robust double-digit pace in 2025 and could accelerate in 2026. The long-term opportunity is for the advertising business to gain enough momentum to attract large advertisers, which is expected to happen by the end of 2025.
Analysts rate Netflix a Moderate Buy, and roughly 85% agree. The stock’s consensus price target lags the market but is up from last year, the second quarter and last month. The latest targets include several recently initiated coverages, one of which set a high price target of $88, which is about 25% above the price action in mid-November.
Companies in this article:
| Company | Current price | Price change | Dividend yield | P/E ratio | Consensus rating | Consensus target price |
|---|---|---|---|---|---|---|
| Netflix (NFLKS) | $886.81 | +1.1% | N/A | 50.19 | Moderate purchase | $764.82 |
| Fastenal (FAST) | $83.56 | -0.2% | 1.87% | 41.57 | Hold | $74.80 |
| Intuitive Surgery (ISRG) | $542.00 | +0.6% | N/A | 87.14 | Moderate purchase | $526.06 |
Experience
Thomas Hughes has been a writer for InsiderTrades.com since 2019.
Areas of Specialization
Technical analysis, S&P 500; retail, consumer, consumer staples, dividends, high yield, small cap, technology, economic data, oil, cryptocurrencies
Education
Associate in Culinary Technology
Past experience
Market watcher, trader and investor of numerous websites. Founded Passive Market Intelligence LLC to provide market research analytics.