June 4th, 2013
by Asif Suria
Insider buying increased with insiders purchasing $141 million of their stock last week compared to $123.67 million in the week prior. Selling decreased with insiders selling $1.8 billion of stock last week compared to $2.79 billion in the week prior. A majority of the insider buying this week was driven by Elon Musk’s $100 million participation in Tesla Motor’s (TSLA) secondary offering.
Sell/Buy Ratio: The insider Sell/Buy ratio is calculated by dividing the total insider sales in a given week by total insider purchases that week. The adjusted ratio for last week dropped to 12.79. In other words, insiders sold more almost 13 times as much stock as they purchased. The Sell/Buy ratio this week compares favorably with the prior week, when the ratio stood at 22.56.
We are calculating an adjusted ratio by removing transactions by funds and companies and trying as best as possible only to retain information about insiders and 10% owners who are not funds or companies.
Note: As mentioned in the first post in this series, certain industries have their preferred metrics such as same store sales for retailers, funds from operations (FFO) for REITs and revenue per available room (RevPAR) for hotels that provide a better basis for comparison than simple valuation metrics. However metrics like Price/Earnings, Price/Sales and Enterprise Value/EBITDA included below should provide a good starting point for analyzing the majority of stocks.
Notable Insider Buys:
1. Carnival Corporation (CCL): $33.1
Director Randall J. Weisenburger acquired 40,000 shares of this cruise ship operator, paying $32.95 per share for a total amount of $1.3 million. Mr. Weisenburger increased his stake by 103.96% to 78,477 shares with this purchase.
Carnival shares are down nearly 10% this year when compared to a nearly 15% rise in the S&P 500 on account of the well-publicized problems with several Carnival cruise ships. Despite this drop, this is the first insider purchase at the company. Over the last two years, insiders have been consistent sellers of the stock.
You can view the list of recent insider transactions for Carnival Corporation here.
|P/E: 17.46||Forward P/E: 14.52||Industry P/E: 32.73|
|P/S: 1.69||Price/Book: 1.1||EV/EBITDA: 10.09|
|Market Cap: $25.65B||Avg. Daily Volume: 5,144,430||52 Week Range: $30.65 – $39.95|
2. Opko Health, Inc. (OPK): $6.61
CEO & Chairman Phillip Frost M.D. acquired 175,300 shares of this medical devices and drug development company, paying $6.83 per share for a total amount of $1.2 million. These shares were purchased indirectly by Frost Gamma Investments Trust.
You can view the list of recent insider transactions for Opko Health, Inc. here.
|P/E: N/A||Forward P/E: N/A||Industry P/E: 20.11|
|P/S: 32.49||Price/Book: 7.05||EV/EBITDA: -103.38|
|Market Cap: $2.23B||Avg. Daily Volume: 1,638,070||52 Week Range: $4 – $7.83|
3. Trio Merger Corp. (TRIO): $10.02
Chairman and CEO Eric Rosenfeld acquired 100,000 shares of this SPAC, paying $10.07 per share for a total amount of $1 million. Mr. Rosenfeld increased his stake by 9.15% to 1,192,374 shares with this purchase.
This is an odd purchase as Trio is a “special purpose acquisition company” or SPAC that went public in February 2011 at a price of $10 per unit. The company recently decided to merge with a seismic data acquisition company called SAExploration Holdings, with the merger expected to complete in June 2013.
You can view the list of recent insider transactions for Trio Merger Corp. here.
|P/E: N/A||Forward P/E: 6.91||Industry P/E: N/A|
|P/S: N/A||Price/Book: 5.61||EV/EBITDA: N/A|
|Market Cap: $78.57M||Avg. Daily Volume: 24,747||52 Week Range: $9.67 – $11.55|
4. AOL Inc. (AOL): $34.66
Director Fredric G. Reynolds acquired 28,000 shares of AOL, paying $34.26 per share for a total amount of $959,308. Mr. Reynolds increased his stake by 37.89% to 101,900 shares with this purchase.
With the resurgence of “old tech” media companies like Yahoo, it is interesting to see this insider purchase of AOL after a pullback in the company stock in May.
You can view the list of recent insider transactions for AOL Inc. here.
|P/E: 2.96||Forward P/E: 18.74||Industry P/E: 21.79|
|P/S: 1.19||Price/Book: 1.2||EV/EBITDA: 5.06|
|Market Cap: $2.68B||Avg. Daily Volume: 1,304,450||52 Week Range: $24.96 – $43.93|
5. Cabela’s Incorporated (CAB): $67.06
Director Reuben Mark acquired 10,000 shares of this sporting goods company, paying $67.17 per share for a total amount of $671,699. Mr. Mark increased his stake by 0.80% to 1,257,413 shares with this purchase.
You can view the list of recent insider transactions for Cabela’s Incorporated here.
|P/E: 24.67||Forward P/E: 17.28||Industry P/E: N/A|
|P/S: 1.45||Price/Book: 3.34||EV/EBITDA: 17.52|
|Market Cap: $4.72B||Avg. Daily Volume: 695,217||52 Week Range: $33.1 – $72.54|
You can view the full list of purchases from this Insider Buying page.
Notable Insider Sales:
1. BlackRock, Inc. (BLK): $279.2
Chairman and CEO Laurence Fink sold 52,616 shares of this asset management company for $285.08, generating $14.9 from the sale.
You can view the list of recent insider transactions for BlackRock, Inc. here.
|P/E: 19.55||Forward P/E: 15.33||Industry P/E: 17.03|
|P/S: 5.11||Price/Book: 1.92||EV/EBITDA: 13.2|
|Market Cap: $47.77B||Avg. Daily Volume: 728,986||52 Week Range: $162.71 – $298.14|
2. Time Warner Inc. (TWX): $58.37
Shares of this entertainment company were sold by 2 insiders:
- Chairman of the Board and CEO Jeffrey L. Bewkes sold 205,681 shares for $59.27, generating $12.2 million from the sale.
- Director Jessica P. Einhorn sold 3,853 shares for $59.35, generating $228,676 from the sale. These shares were sold as a result of exercising options immediately prior to the sale.
You can view the list of recent insider transactions for Time Warner Inc. here.
|P/E: 17.94||Forward P/E: 13.67||Industry P/E: 18.54|
|P/S: 1.94||Price/Book: 1.85||EV/EBITDA: 9.72|
|Market Cap: $54.41B||Avg. Daily Volume: 6,500,920||52 Week Range: $33.64 – $61.73|
3. Bristol-Myers Squibb Company (BMY): $46.01
Shares of this drug manufacturing company were sold by 3 insiders:
- EVP, CSO & President R&D Elliot Sigal sold 143,521 shares for $47.23, generating $6.78 million from the sale. These shares were sold as a result of exercising options immediately prior to the sale.
- Director James M. Cornelius sold 100,000 shares for $47.61, generating $4,761,000 from the sale.
- President, US Pharmaceuticals Giovanni Caforio sold 10,538 shares for $47.06, generating $495,918 from the sale.
You can view the list of recent insider transactions for Bristol-Myers Squibb Company here.
|P/E: 52.11||Forward P/E: 21.5||Industry P/E: 14.2|
|P/S: 4.77||Price/Book: 5.65||EV/EBITDA: 18|
|Market Cap: $75.57B||Avg. Daily Volume: 10,703,500||52 Week Range: $30.64 – $48.83|
4. Huntsman Corporation (HUN): $19.45
Executive Chairman Jon M. Huntsman sold 487,453 shares of this chemicals producer for $19.13, generating $9.3 million from the sale. These shares were sold indirectly by the Huntsman Family Holdings Company LLC.
You can view the list of recent insider transactions for Huntsman Corporation here.
|P/E: 26.64||Forward P/E: 8.24||Industry P/E: 14.51|
|P/S: 0.42||Price/Book: 2.72||EV/EBITDA: 7.2|
|Market Cap: $4.69B||Avg. Daily Volume: 3,989,660||52 Week Range: $10.98 – $20.14|
5. Electronic Arts Inc. (EA): $22.99
Shares of Electronic Arts were sold by 5 insiders:
- Chief Operating Officer Peter R. Moore sold 125,000 shares for $23.14, generating $2.9 million from the sale.
- EVP EA Games Patrick Soderlund sold 75,000 shares for $23.14, generating $1.7 million from the sale.
- EVP, Chief Technology Officer Rajat Taneja sold 39,573 shares for $23.30, generating $922,051 from the sale.
- SVP, Chief Accounting Officer Kenneth A. Barker sold 27,848 shares for $23.31, generating $649,134 from the sale.
- EVP Legal & Business Affairs Joel Linzner sold 15,000 shares for $23.25, generating $348,819 from the sale.
You can view the list of recent insider transactions for Electronic Arts Inc. here.
|P/E: 74.16||Forward P/E: 16.3||Industry P/E: 7.03|
|P/S: 1.85||Price/Book: 3.1||EV/EBITDA: 16.47|
|Market Cap: $6.92B||Avg. Daily Volume: 5,056,440||52 Week Range: $10.77 – $23.6|
You can view the full list of sales from this Insider Sales page.