In recent weeks, significant internal buying activity within one of Canada’s leading grocery retailers Empire Company Limited (TSX:EMP.A) has sparked renewed interest among some investors, considering the dip many grocery retailers have seen of late linked to the well-covered purchase of Whole Foods Market (NASDAQ:WFM) by Amazon.com, Inc. (NASDAQ:AMZN).
With the e-commerce effect now seemingly fully priced into the share prices of most major retailers, it appears that insiders within Empire and outside Empire have begun to take advantage of rising prices, buying into the prospective strength many see in the sector over the coming quarters.
While I have been hesitant on companies such as Empire for some time now due to the company’s underlying fundamentals when compared to its peers, this buying trend among knowledgeable insiders is certainly a good sign for investors who decided to buy at or near the 52-week bottom of retailers such as Empire.
The Canadian market remains a unique one to perform a valuation analysis of, and as the macroeconomic environment continues to develop and transform, I anticipate significant volatility over the coming quarters and years.
I would recommend caution with investors willing to load up on this name, and would recommend taking a balanced approach toward companies such as Empire. That said, picking up shares of this blue-chip Canadian stock have served investors well over the long-term, with the company posting a reasonable 36% return over the past ten years along with a dividend of nearly 2% per year.
Invest wisely, my friends.
