By Mark Skousen, Hedge Fund Trader Alert

Over the years, many of our biggest profits have come from riding the coattails of knowledgeable insiders.

You don’t get buy signals much better than top officers and directors investing significant amounts of their own money in their companies at current market price. That’s why I want to draw your attention to Cirrus Logic (CRUS).

Based in Austin, Texas, Cirrus supplies high-precision analog and digital signal processing components to the audio and energy markets.

The company is a proven innovator, holding more than 1,000 patents that are key to more than 700 products serving thousands of customers around the globe.

However, it has been a tough time for many technology companies lately. And Cirrus is no exception. In the most recent quarter, sales rose modestly but earnings plunged 64%.

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The stock -- which traded this spring above $25 a share -- now resides around $16.50. Of course, a low stock price in itself is never a reason to buy shares.

What excites me about Cirrus is that earnings are likely to hit $1.20 this year and then surge to $1.50 or more in 2012. In fact, shares already are beginning to move higher in anticipation.

My optimism about the future is confirmed by the recent actions of President and CEO Jason Rhode and Director Robert Smith.

Smith has bought 132,000 shares in recent weeks, an investment of more than $2 million. And Rhode has been buying the stock, too. He currently owns approximately 14,000 shares.

Rhode has made it no secret that he expects sales at Cirrus to keep growing faster than the semiconductor industry as a whole. And he sees enormous new opportunities developing in both portable audio and energy.

So follow his lead and use the recent market weakness to pick up Cirrus Logic while it’s still cheap. If you prefer to play this one more aggressively, try the January $19 calls.

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