Insider Trading 31 January 2014: Charles Schwab Selling

February 3rd, 2014
in contributors

by Asif Suria

Insider buying declined last week with insiders purchasing $64.80 million of their stock compared to $78.41 million in the week prior. Selling increased with insiders selling $876.61 million of stock last week compared to $575.8 million in the week prior.

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 13.53. In other words, insiders sold more than 13 times as much stock as they purchased.

Follow up:

The Sell/Buy ratio this week compares unfavorably with the prior week, when the ratio stood at 7.34. 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 January 31, 2014

Insider Sell Buy Ratio January 31, 2014

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 a purchase by the CFO of VeriFone Systems (PAY), a cluster purchase by the insiders of Fastenal (FAST) and a cluster purchase by insiders of First Niagara Financial Group (FNFG).

1. Regis Corp. (RGS): $12.33

Shares of this hair salons company were acquired by 3 insiders:

  • Director Daniel Gordon Beltzman acquired 1,502,507 shares, paying $12.16 per share for a total amount of $18.26 million. These shares were purchased indirectly through Birch Run Capital Advisors.
  • President & CEO Daniel J. Hanrahan acquired 20,000 shares, paying $12.23 per share for a total amount of $244,560. Mr. Hanrahan increased his stake by 9.91% to 221,839 shares with this purchase.
  • Director Stephen E. Watson acquired 2,000 shares, paying $12.17 per share for a total amount of $24,340. Mr. Watson increased his stake by 4.39% to 47,566 shares with this purchase.

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

P/E: N/A Forward P/E: 64.89 Industry P/E: 18.37
P/S: 0.36 Price/Book: 0.94 EV/EBITDA: 7.19
Market Cap: $695.87M Avg. Daily Volume: 697,342 52 Week Range: $11.48 – $19.14

2. American Eagle Outfitters, Inc. (AEO): $13.53

Shares of this apparel chain were acquired by 2 insiders:

  • Executive Chairman of the Board Jay L. Schottenstein acquired 500,000 shares, paying $12.84 per share for a total amount of $6.42 million. These shares were acquired indirectly by SEI Inc.
  • Director Noel Joseph Spiegel acquired 5,000 shares, paying $13.21 per share for a total amount of $66,050. These shares were purchased indirectly through a trust.

You can view the list of recent insider transactions for American Eagle Outfitters, Inc. here.

P/E: 15.96 Forward P/E: 15.03 Industry P/E: 19
P/S: 0.78 Price/Book: 2.21 EV/EBITDA: 4.95
Market Cap: $2.61B Avg. Daily Volume: 5,423,440 52 Week Range: $12.59 – $22.63

3. Opko Health, Inc. (OPK): $7.93

Shares of this medical devices and drug development company were acquired by 2 insiders:

  • CEO & Chairman Phillip Frost M.D. acquired 671,100 shares, paying $8.08 per share for a total amount of $5,422,927. These shares were purchased indirectly by Frost Gamma Investments Trust.
  • Vice Chairman & CTO Jane Hsiao acquired 20,000 shares, paying $8.17 per share for a total amount of $163,377. Mr. Hsiao increased his stake by 0.09% to 21,328,212 shares with this purchase.

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: 14.05
P/S: 36.1 Price/Book: 3.81 EV/EBITDA: -92.47
Market Cap: $3.24B Avg. Daily Volume: 4,381,160 52 Week Range: $6.08 – $12.95

4. Kinder Morgan Energy Partners, L.P. (KMP): $79.48

Vice President (President CO2) James P. Wuerth acquired 20,000 shares of this oil & gas pipelines company, paying $79.08 per share for a total amount of $1.58 million. These shares were purchased indirectly by a Limited Partnership.

You can view the list of recent insider transactions for Kinder Morgan Energy Partners, L.P. here.

P/E: 21.13 Forward P/E: 27.99 Industry P/E: 38.45
P/S: 2.8 Price/Book: 2.09 EV/EBITDA: 12.27
Market Cap: $34.97B Avg. Daily Volume: 1,040,310 52 Week Range: $77.13 – $92.99

5. General Electric Company (GE): $25.13

Chairman and CEO Jeffrey R. Immelt acquired 40,000 shares of General Electric, paying $25.04 per share for a total amount of $1 million. Mr. Immelt increased his stake by 2.20% to 1,857,677 shares with this purchase.

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

P/E: 18.46 Forward P/E: 13.81 Industry P/E: 18.29
P/S: 1.76 Price/Book: 1.96 EV/EBITDA: 22.12
Market Cap: $253.56B Avg. Daily Volume: 38,406,100 52 Week Range: $21.11 – $28.09

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

Notable Insider Sales:

1. E2open, Inc. (EOPN): $23.95

Director John Breese Mumford sold 1,601,926 shares of this application software company for $23.75, generating $38.05 million from the sale. These shares were sold indirectly by Crosspoint Venture Partners.

You can view the list of recent insider transactions for E2open, Inc. here.

P/E: N/A Forward P/E: N/A Industry P/E: 21.16
P/S: 9.17 Price/Book: 42.6 EV/EBITDA: -34.66
Market Cap: $637.50M Avg. Daily Volume: 186,627 52 Week Range: $12.27 – $26.98

2. The Charles Schwab Corporation (SCHW): $24.82

Chairman Charles R. Schwab sold 1,500,000 shares of this investment brokerage for $25.04, generating $37.57 million from the sale. These shares were sold indirectly through a trust.

You can view the list of recent insider transactions for The Charles Schwab Corporation here.

P/E: 31.82 Forward P/E: 21.58 Industry P/E: 24.04
P/S: 6 Price/Book: 3.55 EV/EBITDA: N/A
Market Cap: $32.00B Avg. Daily Volume: 6,628,270 52 Week Range: $15.96 – $27.11

3. Discover Financial Services (DFS): $53.65

Shares of this credit card company were sold by 6 insiders:

  • President and COO Roger C. Hochschild sold 100,000 shares for $54.22, generating $5.42 million from the sale.
  • Executive Vice President Carlos Minetti sold 82,231 shares for $54.82, generating $4.51 million from the sale. 22,231 of these shares were sold as a result of exercising options immediately prior to the sale.
  • Executive Vice President Diane E. Offereins sold 50,000 shares for $54.36, generating $2.72 million from the sale.
  • EVP,Chief Credit Risk Officer James V. Panzarino sold 40,000 shares for $54.71, generating $2.19 million from the sale.
  • SVP & CIO Glenn P. Schneider sold 29,070 shares for $54.25, generating $1.58 million from the sale.
  • SVP & Chief Corp. Risk Officer Steven E. Cunningham sold 15,000 shares for $54.53, generating $817,950 from the sale.

You can view the list of recent insider transactions for Discover Financial Services here.

P/E: 10.82 Forward P/E: 9.79 Industry P/E: 16.04
P/S: 3.18 Price/Book: 2.39 EV/EBITDA: N/A
Market Cap: $25.48B Avg. Daily Volume: 2,986,740 52 Week Range: $37.24 – $56.2

4. Facebook, Inc. (FB): $62.57

Shares of Facebook were sold by 3 insiders:

  • Chief Operating Officer Sheryl Sandberg sold 283,334 shares for $54.74, generating $15.51 million from the sale.
  • Chief Technology Officer Michael Todd Schroepfer sold 25,000 shares for $54.69, generating $1.37 million from the sale.
  • Chief Accounting Officer Jas Athwal sold 500 shares for $54.60, generating $27,300 from the sale.

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

P/E: 104.28 Forward P/E: 37.47 Industry P/E: 51.46
P/S: 19.07 Price/Book: 9.7 EV/EBITDA: 36.48
Market Cap: $153.80B Avg. Daily Volume: 67,252,100 52 Week Range: $22.67 – $63.37

5. JPMorgan Chase & Co. (JPM): $55.36

Shares of this JP Morgan were sold by 6 insiders:

  • Chief Operating Officer Matthew E. Zames sold 76,000 shares for $55.25, generating $4.19 million from the sale.
  • Executive Vice President Gordon Smith sold 71,953 shares for $55.26, generating $3.98 million from the sale.
  • Managing Director Mary E. Erdoes sold 63,802 shares for $55.25, generating $3.52 million from the sale.
  • Managing Director Daniel E. Pinto sold 63,718 shares for $55.35, generating $3.53 million from the sale.
  • Managing Director Douglas B. Petno sold 21,110 shares for $55.26, generating $1.17 million from the sale.
  • Chief Financial Officer Marianne Lake sold 4,880 shares for $55.26, generating $269,661 from the sale.

You can view the list of recent insider transactions for JPMorgan Chase & Co. here.

P/E: 12.73 Forward P/E: 8.72 Industry P/E: 14.62
P/S: 2.19 Price/Book: 1.05 EV/EBITDA: N/A
Market Cap: $208.27B Avg. Daily Volume: 18,089,500 52 Week Range: $46.05 – $59.82

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

Voluntary Disclosure: I hold a long position in Regis (RGS), VeriFone Systems (PAY) and First Niagara Financial (FNFG).

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









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