August 24th, 2014
by Asif Suria
Insider buying dropped a little last week with insiders buying $32.38 million of stock compared to $33.73 million in the week prior. Selling increased with insiders selling $897.75 million of stock last week compared to $812.44 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 went up to 27.74. In other words, insiders sold almost 28 times as much stock as they purchased. The Sell/Buy ratio this week compares unfavorably with the prior week, when the ratio stood at 24.1.
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 August 22, 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:
1. Southern Copper Corp. (SCCO): $32.06
Chairman of the Board Larrea German Velasco acquired 100,000 shares of this copper mining company, paying $31.36 per share for a total amount of $3.14 million. Mr. Velasco increased his stake by 19.25% to 619,367 shares with this purchase.
You can view the list of recent insider transactions for Southern Copper Corp. here.
|P/E: 18.61||Forward P/E: 15.19||Industry P/E: 20|
|P/S: 4.53||Price/Book: 4.39||EV/EBITDA: 10.49|
|Market Cap: $26.68B||Avg. Daily Volume: 1,729,440||52 Week Range: $24.5 – $33.9|
2. Intevac Inc. (IVAC): $6.99
Director Matthew A. Drapkin acquired 218,562 shares of this electronic manufacturing company, paying $6.75 per share for a total amount of $1.48 million. These shares were purchased indirectly by Becker Drapkin Partners, L.P.
We mentioned a $3.09 million purchase of Intevac by Becker Drapkin Partners two weeks ago as well.
You can view the list of recent insider transactions for Intevac Inc. here.
|P/E: N/A||Forward P/E: N/A||Industry P/E: 17.15|
|P/S: 2.32||Price/Book: 1.37||EV/EBITDA: -10.28|
|Market Cap: $165.14M||Avg. Daily Volume: 213,723||52 Week Range: $4.82 – $10.2|
3. GNC Holdings Inc. (GNC): $37.36
Director Michael F. Hines acquired 30,000 shares of this health care products retailers, paying $35.41 per share for a total amount of $1.06 million. Mr. Hines increased his stake by 421.47% to 37,118 shares with this purchase.
This is the first insider purchase since the November 2012 cluster of insider purchases in the range of $32 to $33 per share. The stock nearly doubled following those purchase before giving back most of those gains and dropping to current levels. Top line growth appears to have stalled but the company is trading at a reasonable 8.8 times EBITDA.
You can view the list of recent insider transactions for GNC Holdings Inc. here.
|P/E: 13.65||Forward P/E: 11.79||Industry P/E: 20.84|
|P/S: 1.25||Price/Book: 4.44||EV/EBITDA: 8.81|
|Market Cap: $3.36B||Avg. Daily Volume: 2,386,930||52 Week Range: $30.84 – $60.98|
4. ZAIS Financial Corp. (ZFC): $18.8
Shares of this mortgage REIT were acquired by 5 insiders:
- Director Christian Zugel acquired 30,000 shares, paying $18.93 per share for a total amount of $567,900. Mr. Zugel increased his stake by 36.18% to 112,911 shares with this purchase.
- CEO, President and Director Michael Szymanski acquired 5,300 shares, paying $18.50 per share for a total amount of $98,050. Mr. Szymanski increased his stake by 23.40% to 27,946 shares with this purchase.
- Director Daniel Mudge acquired 3,000 shares, paying $18.80 per share for a total amount of $56,400. Mr. Mudge increased his stake by 100.00% to 6,000 shares with this purchase.
- Director James Zinn acquired 2,650 shares, paying $18.59 per share for a total amount of $49,264. Mr. Zinn increased his stake by 82.81% to 5,850 shares with this purchase.
- Director Marran H. Ogilvie acquired 1,140 shares, paying $18.71 per share for a total amount of $21,325. Ms. Ogilvie increased her stake by 36.19% to 4,290 shares with this purchase.
You can view the list of recent insider transactions for ZAIS Financial Corp. here.
|P/E: 20.77||Forward P/E: N/A||Industry P/E: 20.25|
|P/S: 2.75||Price/Book: 0.84||EV/EBITDA: N/A|
|Market Cap: $149.84M||Avg. Daily Volume: 64,813||52 Week Range: $15.62 – $19.15|
5. Covidien plc (COV): $88.26
Shares of this medical devices company were acquired by 2 insiders:
- Vice President Coleman N. Lannum III acquired 5,820 shares, paying $87.65 per share for a total amount of $510,122. Mr. Lannum increased his stake by 88.38% to 12,405 shares with this purchase.370 of these shares were purchased indirectly by Mr. Lannum’s wife.
- Vice President and Controller Richard G. Brown Jr. acquired 2,000 shares, paying $87.69 per share for a total amount of $175,388. Mr. Brown increased his stake by 3.65% to 56,764 shares with this purchase. 500 of these shares were purchased indirectly by Mr. Brown’s son.
It was a little surprising to see these purchases in light of the pending merger of Covidien with Medtronic (MDT) in a tax inversion deal that has drawn a lot of attention. The deal was the central character in Allan Sloan’s cover story in Fortune titled Positively un-American tax dodges. The spread on the deal is 8.75% (19.84% annualized if the deal closes by early next year) according to our merger arbitrage tool.
You can view the list of recent insider transactions for Covidien plc here.
|P/E: 25.25||Forward P/E: 20.06||Industry P/E: 25.32|
|P/S: 3.86||Price/Book: 4.04||EV/EBITDA: 15.57|
|Market Cap: $39.87B||Avg. Daily Volume: 5,812,620||52 Week Range: $59.17 – $92.68|
You can view the full list of purchases from this Insider Buying page.
Notable Insider Sales:
1. The Priceline Group Inc. (PCLN): $1277.5
Shares of this online travel company were sold by 2 insiders:
- Director Jeffery H. Boyd sold 18,000 shares for $1281.27, generating $23.06 million from the sale. These shares were sold indirectly by a charitable foundation controlled by Mr. Boyd
- Director Craig W. Rydin sold 1,519 shares for $1282.60, generating $1.95 million from the sale.
You can view the list of recent insider transactions for The Priceline Group Inc. here.
|P/E: 34.09||Forward P/E: 19.68||Industry P/E: 23.79|
|P/S: 8.76||Price/Book: 8.48||EV/EBITDA: 21.32|
|Market Cap: $67.00B||Avg. Daily Volume: 746,473||52 Week Range: $930.82 – $1378.96|
2. Juniper Networks, Inc. (JNPR): $24.05
Shares of this network infrastructure company were sold by 2 insiders:
- Director Scott Kriens sold 877,037 shares for $23.80, generating $20.87 million from the sale. These shares were sold indirectly by various trusts.
- EVP CTO Pradeep Sindhu sold 55,000 shares for $23.94, generating $1.32 million from the sale. These shares were sold indirectly through a trust.
You can view the list of recent insider transactions for Juniper Networks, Inc. here.
|P/E: 26.72||Forward P/E: 12.86||Industry P/E: 20.58|
|P/S: 2.23||Price/Book: 1.72||EV/EBITDA: 11.17|
|Market Cap: $10.85B||Avg. Daily Volume: 6,623,870||52 Week Range: $18.36 – $28.75|
3. Intercept Pharmaceuticals, Inc. (ICPT): $287.11
Director Jonathan Silverstein sold 60,000 shares of this drug manufacturer for $299.82, generating $17.99 million from the sale. These shares were sold indirectly by OrbiMed Private Investments.
You can view the list of recent insider transactions for Intercept Pharmaceuticals, Inc. here.
|P/E: N/A||Forward P/E: N/A||Industry P/E: 21.59|
|P/S: 3||Price/Book: 20.49||EV/EBITDA: -87.37|
|Market Cap: $6.09B||Avg. Daily Volume: 535,305||52 Week Range: $43.15 – $497|
4. Jarden Corp. (JAH): $58.73
Shares of this consumer products company were sold by 2 insiders:
- Executive Chairman Martin E. Franklin sold 133,000 shares for $57.47, generating $7.64 million from the sale.
- Chief Executive Officer James E. Lillie sold 45,000 shares for $57.47, generating $2.59 million from the sale.
You can view the list of recent insider transactions for Jarden Corp. here.
|P/E: 33.11||Forward P/E: 13.32||Industry P/E: 21.14|
|P/S: 0.97||Price/Book: 2.93||EV/EBITDA: 13.05|
|Market Cap: $7.53B||Avg. Daily Volume: 974,430||52 Week Range: $42.88 – $64.01|
5. Brookdale Senior Living Inc. (BKD): $34.65
Shares of this long–term care facility were sold by 3 insiders:
- President and CFO Mark W. Ohlendorf sold 200,000 shares for $34.02, generating $6.8 million from the sale.
- Director Mark J. Schulte sold 90,000 shares for $33.78, generating $3.04 million from the sale. 20,000 of these shares were sold indirectly by GRAT.
- Executive Vice President Glenn O. Maul sold 11,484 shares for $32.58, generating $374,148 from the sale.
You can view the list of recent insider transactions for Brookdale Senior Living Inc. here.
|P/E: N/A||Forward P/E: 165||Industry P/E: 20.46|
|P/S: 2.28||Price/Book: 4.17||EV/EBITDA: 19.16|
|Market Cap: $5.99B||Avg. Daily Volume: 1,913,700||52 Week Range: $24.42 – $36.18|
You can view the full list of sales from this Insider Sales page.
Connect with me on LinkedIn: http://www.linkedin.com/in/asifsuria