Insider Trading 13 December 2013: Icahn and Buffett Buying

December 16th, 2013
in contributors

by Asif Suria

Insider buying doubled with insiders purchasing $144.43 million of their stock last week compared to $69.73 million in the week prior. Selling also increased sharply with insiders selling $2.32 Billion of stock last week compared to $990.8 billion in the week prior. A majority of the insider buying this week was driven by a $76 million purchase of DaVita Healthcare Partners (DVA) by Berkshire Hathaway (BRK-A) and a $19.48 million purchase of Nuance (NUAN) by Carl Icahn.

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 increased to 16.1.In other words, insiders sold more than 16 times as much stock as they purchased. The Sell/Buy ratio this week compares unfavorably with the prior week, when the ratio stood at 14.2.

Follow up:

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.

Insider Sell Buy Ratio December 13, 2013

Insider Sell Buy Ratio December 13, 2013

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:

Some of the insider purchases that did not make the top 5 list but are worth exploring include apurchase by the CEO of Model N (MODN), a cluster of purchases by the insiders of Magnum Hunter Resources (MHR), additional purchases by insiders of Halcon Resources (HK) and additional purchases by insiders of Digital Realty Trust (DLR).

1. Esterline Technologies Corp. (ESL): $92.42

Director Henry Ward Winship IV acquired 103,528 shares of this aerospace and defense products company, paying $91.84 per share for a total amount of $9.51 million. These shares were purchased indirectly by Relational Investors LLC.

You can view the list of recent insider transactions for Esterline Technologies Corp. here.

P/E: 18.19 Forward P/E: 14.83 Industry P/E: 16.14
P/S: 1.47 Price/Book: 1.67 EV/EBITDA: 9.22
Market Cap: $2.90B Avg. Daily Volume: 165,294 52 Week Range: $61.87 – $93.4

2. AmTrust Financial Services, Inc. (AFSI): $33.64

Director George Karfunkel acquired 200,000 shares of this insurance company, paying $32.48 per share for a total amount of $6.49 million. Mr. Karfunkel increased his stake by 2.16% to 9,471,286 shares with this purchase.

You can view the list of recent insider transactions for AmTrust Financial Services, Inc. here.

P/E: 9.42 Forward P/E: 9.61 Industry P/E: 13.86
P/S: 0.97 Price/Book: 1.97 EV/EBITDA: 8.74
Market Cap: $2.51B Avg. Daily Volume: 624,809 52 Week Range: $25.45 – $42.64

3. Akamai Technologies, Inc. (AKAM): $45.72

Shares of this content delivery and cloud infrastructure company were acquired by 2 insiders:

  • Chief Executive Officer Thomson F. Leighton acquired 25,000 shares, paying $45.28 per share for a total amount of $1.13 million. These shares were purchased indirectly through a trust.
  • Director George H. Conrades acquired 20,000 shares, paying $44.95 per share for a total amount of $899,100. Mr. Conrades increased his stake by 2.06% to 993,007 shares with this purchase.

You can view the list of recent insider transactions for Akamai Technologies, Inc. here.

P/E: 29.69 Forward P/E: 21.27 Industry P/E: 35.71
P/S: 5.15 Price/Book: 3.07 EV/EBITDA: 13.19
Market Cap: $8.18B Avg. Daily Volume: 2,273,870 52 Week Range: $32.63 – $53.61

4. Opko Health, Inc. (OPK): $8.97

CEO & Chairman Phillip Frost M.D. acquired 122,500 shares of this medical devices and drug development company, paying $9.75 per share for a total amount of $1.19 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: 23.52
P/S: 41.73 Price/Book: 4.4 EV/EBITDA: -125.26
Market Cap: $3.66B Avg. Daily Volume: 5,209,190 52 Week Range: $4.55 – $12.95

5. Calamos Asset Management Inc. (CLMS): $10.93

Chairman, CEO, Global Co-CIO John P. Calamos Sr. acquired 97,845 shares of this asset management company, paying $10.88 per share for a total amount of $1,064,936. Mr. Calamos increased his stake by 6.31% to 1,648,367 shares with this purchase.

You can view the list of recent insider transactions for Calamos Asset Management Inc. here.

P/E: 18.19 Forward P/E: 19.87 Industry P/E: N/A
P/S: 0.8 Price/Book: 1.07 EV/EBITDA: -2.49
Market Cap: $224.39M Avg. Daily Volume: 150,109 52 Week Range: $9.46 – $12.26

You can view the full list of purchases from this Insider Buying page.

Notable Insider Sales:

1. Facebook, Inc. (FB): $53.32

Shares of Facebook were sold by 2 insiders:

  • Chief Financial Officer David A. Ebersman sold 523,400 shares for $50.00, generating $26.17 million from the sale.
  • VP Marketing & Business Part. David B. Fischer sold 36,000 shares for $50.79, generating $1.83 million from the sale.

You can view the list of recent insider transactions for Facebook, Inc. here.

P/E: 136.37 Forward P/E: 47.61 Industry P/E: 35.71
P/S: 18.52 Price/Book: 9.69 EV/EBITDA: 32.09
Market Cap: $130.89B Avg. Daily Volume: 77,598,400 52 Week Range: $22.67 – $54.83

2. Barnes & Noble, Inc. (BKS): $14.08

Chairman of the Board Leonard Riggio sold 2,000,000 shares of this bookseller for $13.81, generating $27.62 million from the sale. 1,349,648 of these shares were sold indirectly through a trust. This was a privately negotiated block trade for tax planning purposes.

You can view the list of recent insider transactions for Barnes & Noble, Inc. here.

P/E: N/A Forward P/E: N/A Industry P/E: 22.88
P/S: 0.13 Price/Book: 1.34 EV/EBITDA: 25.42
Market Cap: $841.11M Avg. Daily Volume: 1,318,310 52 Week Range: $12.59 – $23.71

3. Perrigo Company (PRGO): $151.82

Shares of this pharmaceutical company were sold by 2 insiders:

  • Director Michael J. Jandernoa sold 128,620 shares for $155.30, generating $19.97 million from the sale. These shares were sold indirectly through various trusts.
  • Executive VP Global Quality Louis Yu sold 70 shares for $155.22, generating $10,865 from the sale. These shares were sold indirectly through a trust.

You can view the list of recent insider transactions for Perrigo Company here.

P/E: 32.03 Forward P/E: 19.05 Industry P/E: 32.57
P/S: 3.91 Price/Book: 5.87 EV/EBITDA: 17.47
Market Cap: $14.32B Avg. Daily Volume: 1,045,850 52 Week Range: $98.79 – $157.47

4. KCG Holdings, Inc. (KCG): $11.55

Director Stephen Schuler sold 1,082,934 shares of this market making and financial services firm for $11.59, generating $12.56 million from the sale. These shares were sold indirectly by Serenity Investments, LLC.

You can view the list of recent insider transactions for KCG Holdings, Inc. here.

P/E: 2.14 Forward P/E: N/A Industry P/E: 14.78
P/S: 1.71 Price/Book: 0.94 EV/EBITDA: 6.48
Market Cap: $1.41B Avg. Daily Volume: 453,661 52 Week Range: $8.11 – $12.16

5. Illinois Tool Works Inc. (ITW): $78.95

Shares of this diversified machinery company were sold by 3 insiders:

  • Director Robert C. McCormack sold 104,000 shares for $80.11, generating $8.33 million from the sale. These shares were sold indirectly through various trusts.
  • President & CEO Ernest Scott Santi sold 46,250 shares for $80.00, generating $3.7 million from the sale. These shares were sold as a result of exercising options immediately prior to the sale.
  • Sr. VP, General Counsel & Secretary Maria C. Green sold 6,500 shares for $80.52, generating $523,380 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 Illinois Tool Works Inc. here.

P/E: 15.98 Forward P/E: 17.66 Industry P/E: 18.22
P/S: 2.02 Price/Book: 3.33 EV/EBITDA: 11.07
Market Cap: $35.04B Avg. Daily Volume: 1,811,070 52 Week Range: $59.55 – $80.67

You can view the full list of sales from this Insider Sales page.

Connect with me on LinkedIn: http://www.linkedin.com/in/asifsuria

Voluntary Disclosure: I have a long position in Magnum Hunter Resources (MHR).









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