Taking a Deeper Look at the Opportunity in Javelin Mortgage

What I like about Javelin Mortgage is that it pays its dividend monthly, so investors can compound their investments at a greater pace versus a quarterly distribution. I also like that Javelin Mortgage forward declares its dividends over the next three months.

Insiders have been buying

People buy stock for one reason and one reason only: They see value and want to make money. That being said, there have been insiders at Javelin Mortgage who purchased a number of shares since the selloff in the mREITs began. No one is selling. Table 1 has the details of recent insider transactions.

Table 1. Javelin Mortgage Investment Insider Trades in Last Seven Months

Insider Number of Shares Purchased Price Paid Date Purchased
Jeffrey Zimmer 5,000 $11.9119 11/26/2013
Ulm Scott 5,000 $11.9163 11/26/2013
Daniel C. Staton 5,000 $15 6/3/2013
Daniel C. Staton 1,200 $15.0758 5/29/2013
James R. Mountain 4,000 $15.29 5/29/2013
Ulm Scott 1,000 $14.9348 5/29/2013
John C. Chrystal 1,000 $14.81 5/29/2013
John C. Chrystal 500 $18.828 5/14/2013

Clearly, insiders believe the company will do well going forward. Prior to this wave of buying, there had been no insider trades since just after the stock had its initial public offering. Insider buying is usually a sign of strength, particularly when there is a wave of purchases close together when there had been none prior. Couple this with the fact that there has been no selling and we have a real bullish setup.