Congress Beat the Market Again-Here Are the 3 Stocks They Bought

The issue of banning Congressional stock trading is gaining momentum. It’s not only retail investors who are drawing attention to the issue. Members of Congress themselves are starting to raise questions.

The issue isn’t whether Congressional leaders should be allowed to own stocks, but whether they should be able to actively trade stocks. MarketBeat offers a free tool that enables investors to track congressional stock trades. It’s as current as it can be.

However, the trades don’t have to be disclosed for about two weeks after they’re made. That means by the time they’re disclosed, the biggest price moves may have already occurred. Plus, members are only required to report the dollar amount of the trade within a broad range, for example, between $100,001 and $250,000.

Keep in mind, individual investors, even when they’re members of Congress, buy stocks for many reasons. In other words, correlation doesn’t mean causation. However, finding stocks that have some buying momentum is important no matter what’s stimulating the buying activity.

That's the focus of this article. Here are three stocks that members of Congress have purchased, which posted gains in November when the rest of the market experienced a sell-off.

RV Component Maker Rebounds on Strong Earnings and Industry Tailwinds

The first stock that might interest investors is LCI Industries (NYSE: LCII), currently the third-most purchased stock by Congress. LCI Industries manufactures engineered components and systems for the recreational vehicle (RV), marine and housing industries. This industry benefited from a surge in demand in 2020 and 2021, but sales have normalized for the last several years.

In early November, Tony Wied, a congressman from Wisconsin, reported a trade between $1 million and $5 million at an average share price of $92.02. Since that point, LCII stock is up 24.2%. One reason for that could have been the company’s earnings report. LCII beat on the top and bottom lines.

This could be a correlation with data from the RV Industry Association (RVIA), which forecasts that RV sales will reach about 337,000 units by the end of 2025 and will continue to grow into the mid-300,000 unit range in 2026.

Homebuilder for First-Time Buyers Rallies as Housing Market Shows Signs of Thawing

Following the contrarian trend, the next stock on this list is LGI Homes Inc. (NASDAQ: LGIH). LGI Homes is a homebuilder that focuses on first-time homebuyers.

Like the RV industry, the housing market was on fire in 2020 and 2021, but has cooled significantly in the last few years. A key reason for that has been interest rates. While they may not be high from a historical standpoint, the sharp rise from near zero to nearly 5% at one point made home affordability a key issue for many Americans.

In this case, the specific trade was made by Tim Moore, a congressman from North Carolina. On Oct. 30, Moore purchased between $15,000 and $50,000 of LGIH stock at an average price of $40.83.

Since that point, LGIH stock is up more than 28%. Perhaps, more significantly, analysts give the stock a consensus price target of $72.13, which would be a gain of over 36% from its closing price on Nov. 28. This may support recent evidence of thawing in the frozen housing market, although the growth remains limited to specific regions.

High-Priced Insurance Holding Company Climbs on Earnings Strength and Buyback Plan

The last stock on this list is White Mountains Insurance Group Ltd. (NYSE: WTM). This is a diversified insurance and financial services holding company headquartered in Bermuda.

It’s a pricey stock that trades for over $2,000 a share. That may keep some investors away from investing in it. However, that didn’t stop at least one member of Congress from investing in the company. Michael McCaul, a Congressman from Texas, made two separate purchases of WTM stock on Aug. 20 and Sept. 22, respectively. Each purchase was between $15,000 and $50,000.

For full disclosure, McCaul also sold some WTM stock on Aug. 21. However, that sale was in the range of $1,000 and $15,000.

Since the initial purchase in August, White Mountains' stock is up 10.6%. That’s partially supported by the company’s strong earnings report, which it delivered in early November. The company has also recently commenced a “modified Dutch auction” self-tender offer to purchase up to $300 million in value of its common shares.

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The article "Congress Beat the Market Again—Here Are the 3 Stocks They Bought" first appeared on MarketBeat.