September 14th, 2014
by Asif Suria
Insider buying increased last week with insiders buying $35.47 million of stock compared to $22.81 million in the week prior. Selling more than quadrupled with insiders selling $3.37 billion of stock last week compared to $725.84 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 shot up to 95.05. In other words, insiders sold more than 95 times as much stock as they purchased. The Sell/Buy ratio this week compares unfavorably with the prior week, when the ratio stood at 31.82.
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 September 12, 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. American Assets Trust, Inc. (AAT): $33.76
Executive Chairman Ernest S. Rady acquired 400,000 shares of this diversified REIT, paying $33.76 per share for a total amount of $13.5 million. These shares were purchased indirectly by the Insurance Company of the West (“ICW”).
American Assets Trust owns a portfolio of retail, office, apartment and hotel properties across the western states and Hawaii. The company sports a yield of 2.6% and trades at 21.23 times expected 2014 funds from operations (FFO) of $1.56 to $1.62 per share.
You can view the list of recent insider transactions for American Assets Trust, Inc. here.
|P/E: 81.74||Forward P/E: 19.74||Industry P/E: 30.79|
|P/S: 5.88||Price/Book: 2.1||EV/EBITDA: 16.61|
|Market Cap: $1.44B||Avg. Daily Volume: 149,878||52 Week Range: $30.13 – $35.84|
2. Southern Copper Corp. (SCCO): $31.93
Chairman of the Board German Larrea Mota-Velasco acquired 150,000 shares of this copper mining company, paying $31.77 per share for a total amount of $4.77 million. Mr. Velasco increased his stake by 17.25% to 1,019,367 shares with this purchase.
This is the third week in a row we are reporting insider purchases by Mr. Mota-Velasco.
As the name implies, Southern Copper generates a majority (75%) of its revenue from copper, 12% from molybdenum and nearly 5% from silver. While the company appears to be well run, the headwinds they have faced include low copper prices, high stockpiles of copper and low silver prices.
While the company expects copper supply to drop and sees signs of stockpiles depleting, it remains to be seen if global demand and hence prices will pick up. Southern Copper is spending aggressively (CapEx is well over net income) and expects their copper production capacity to increase 87% by 2015 when compared to 2013 levels. They obviously see a brighter future than is evident right now.
One bright spot for the company right now is molybdenum, where they saw a 30% increase in production last quarter. Molybdenum prices are also up sharply this year despite some weakness in the summer.
You can view the list of recent insider transactions for Southern Copper here.
|P/E: N/A||Forward P/E: N/A||Industry P/E: 18.97|
|P/S: N/A||Price/Book: N/A||EV/EBITDA: N/A|
|Market Cap: $N/A||Avg. Daily Volume: N/A||52 Week Range: $24.5 – $33.9|
3. Nuverra Environmental Solutions, Inc. (NES): $14.23
Shares of this provider of environment solutions to the energy sector were acquired by 2 insiders:
- Chairman of the Board and CEO Mark D. Johnsrud acquired 124,551 shares, paying $13.70 per share for a total amount of $1.71 million. Mr. Johnsrud increased his stake by 1.29% to 9,789,319 shares with this purchase.
- Executive VP & Chief Legal Officer Joseph M. Crabb acquired 5,000 shares, paying $13.61 per share for a total amount of $68,050. Mr. Crabb increased his stake by 35.71% to 19,000 shares with this purchase.
You can view the list of recent insider transactions for Nuverra Environmental Solutions, Inc. here.
|P/E: N/A||Forward P/E: N/A||Industry P/E: 32.23|
|P/S: 0.77||Price/Book: 0.65||EV/EBITDA: 12.43|
|Market Cap: $380.38M||Avg. Daily Volume: 367,684||52 Week Range: $12.9 – $25.1|
4. TransDigm Group Incorporated (TDG): $189.42
Executive Vice President James Skulina acquired 6,578 shares of this aircraft components manufacturer, paying $187.71 per share for a total amount of $1.23 million. These shares were purchased indirectly through a trust.
You can view the list of recent insider transactions for TransDigm Group Incorporated here.
|P/E: 54.92||Forward P/E: 22.42||Industry P/E: 20.2|
|P/S: 4.38||Price/Book: N/A||EV/EBITDA: 16.7|
|Market Cap: $9.98B||Avg. Daily Volume: 386,583||52 Week Range: $134.48 – $198.29|
5. Titan Machinery, Inc. (TITN): $13.42
Chairman and CEO David Joseph Meyer acquired 90,250 shares of this agricultural and construction equipment retailer, paying $13.01 per share for a total amount of $1.17 million. Mr. Meyer increased his stake by 13.59% to 754,258 shares with this purchase.
You can view the list of recent insider transactions for Titan Machinery, Inc. here.
|P/E: 58.35||Forward P/E: 19.74||Industry P/E: N/A|
|P/S: 0.13||Price/Book: 0.71||EV/EBITDA: 14.54|
|Market Cap: $281.63M||Avg. Daily Volume: 202,031||52 Week Range: $11.85 – $20.4|
You can view the full list of purchases from this Insider Buying page.
Notable Insider Sales:
1. Michael Kors Holdings Limited (KORS): $76.82
Director Silas K.F. Chou sold 11,629,627 shares of this apparel chain for $76.75, generating $892.57 million from the sale. These shares were sold indirectly by Sportswear Holdings Limited. You can check out a short biography of Mr. Chou here.
You can view the list of recent insider transactions for Michael Kors Holdings Limited here.
|P/E: 23.86||Forward P/E: 16.04||Industry P/E: 20.94|
|P/S: 4.31||Price/Book: 7.62||EV/EBITDA: 12.33|
|Market Cap: $15.70B||Avg. Daily Volume: 3,822,140||52 Week Range: $70.59 – $101.04|
2. Facebook, Inc. (FB): $77.48
Shares of Facebook were sold by 2 insiders:
- Chief Operating Officer Sheryl Sandberg sold 283,334 shares for $77.33, generating $21.91 million from the sale.
- Chief Technology Officer Michael Todd Schroepfer sold 75,000 shares for $75.90, generating $5.69 million from the sale.
You can view the list of recent insider transactions for Facebook, Inc. here.
|P/E: 100.49||Forward P/E: 38.36||Industry P/E: 32.37|
|P/S: 20.23||Price/Book: 10.89||EV/EBITDA: 34.62|
|Market Cap: $201.45B||Avg. Daily Volume: 36,728,300||52 Week Range: $42.43 – $78.36|
3. KapStone Paper and Packaging Corporation (KS): $30.2
President & COO Matthew S. Kaplan sold 350,000 shares of this paper products company for $32.10, generating $11.24 million from the sale.
You can view the list of recent insider transactions for KapStone Paper and Packaging Corporation here.
|P/E: 20.7||Forward P/E: 12.08||Industry P/E: 15.46|
|P/S: 1.34||Price/Book: 3.97||EV/EBITDA: 9.24|
|Market Cap: $2.90B||Avg. Daily Volume: 1,200,160||52 Week Range: $20.39 – $34.43|
4. Raytheon Company (RTN): $100.77
Shares of this aerospace and defense company were sold by 2 insiders:
- Chairman of the Board William H. Swanson sold 100,000 shares for $100.31, generating $10.03 million from the sale.
- Vice President Richard R. Yuse sold 7,529 shares for $100.00, generating $752,900 from the sale.
You can view the list of recent insider transactions for Raytheon Company here.
|P/E: 15.65||Forward P/E: 12.99||Industry P/E: 20.2|
|P/S: 1.37||Price/Book: 2.67||EV/EBITDA: 9.36|
|Market Cap: $31.31B||Avg. Daily Volume: 1,528,670||52 Week Range: $73.81 – $102.33|
5. ServiceNow, Inc. (NOW): $61.61
Shares of this software-as-a-service provider were sold by 2 insiders:
- Chief Product Officer Frederic B. Luddy sold 151,400 shares for $62.54, generating $9.47 million from the sale. 50,000 of these shares were sold indirectly by Frederic B. Luddy CRT, LLC and 1,400 shares were sold indirectly by Mr. Luddy’s spouse.
- Chief Revenue Officer David Schneider sold 16,000 shares for $62.15, generating $994,468 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 ServiceNow, Inc. here.
|P/E: N/A||Forward P/E: 293.38||Industry P/E: N/A|
|P/S: 17.02||Price/Book: 23.11||EV/EBITDA: -103.53|
|Market Cap: $8.98B||Avg. Daily Volume: 1,465,720||52 Week Range: $44.17 – $71.8|
You can view the full list of sales from this Insider Sales page.
Connect with me on LinkedIn: http://www.linkedin.com/in/asifsuria