Insider Weekends – Twitter’s Jack Dorsey Makes a Large Purchase

Welcome to edition 348 of Insider Weekends. Insider buying increased for a second week in a row with insiders buying $50.18 million of stock compared to $24.08 million in the week prior. Selling also increased with insiders selling $1.91 billion of stock last week compared to $1.53 billion in the week prior. The S&P 500 gained 1.51% for the week and hit all time highs.

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 38.04. In other words, insiders sold more than 38 times as much stock as they purchased. The Sell/Buy ratio this week compares favorably with the prior week, when the ratio stood at 63.73.

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. Twitter, Inc. (TWTR): $16.62

Chief Executive Officer Jack Dorsey acquired 425,998 shares of Twitter, paying $16.43 per share for a total amount of $7 million. These shares were purchased indirectly through a trust.

While this purchase was large, it was a little unusual to see Mr. Dorsey mention the purchase in a Tweet. Insiders sometimes buy to signal the market and I am usually wary of companies that publicize their executive purchases through press releases or other means. While this purchase by Mr. Dorsey is large, it amounts to less than half the proceeds from his sales in 2014-2015 when he sold $15.72 million worth of stock. I discussed this purchase in a mini-tweetstorm earlier this week. An excerpt of those tweets is given below.

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

2. Global Water Resources, Inc. (GWRS): $8.7

Director William S. Levine acquired 500,000 shares of this water resource management company, paying $8.20 per share for a total amount of $4.1 million. These shares were purchased indirectly by Levine Investments Limited Partnership.

You can view the list of recent insider transactions for Global Water Resources, Inc. here.

3. Coty Inc. (COTY): $18.89

Shares of this cosmetics company were acquired by 2 insiders:

• Chief Executive Officer Camillo Pane acquired 72,350 shares, paying $19.54 per share for a total amount of $1.41 million. Mr. Pane increased his stake by 33.60% to 287,657 shares with this purchase.
• Chief Legal Officer Greerson Greene McMullen acquired 40,500 shares, paying $18.50 per share for a total amount of $749,222.

Coty has seen its stock drop more than 34% over the last year, underperforming the S&P 500 by more than 57%. With a leveraged balance sheet, declining revenue and the stock trading at over 23 times EBITDA, it is difficult to understand why insiders are buying even at these levels.

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

4. Fifth Street Senior Floating Rate Corp. (FSFR): $9.09

Shares of this specialty finance company were acquired by 4 insiders:

• 10% Owner Leonard M. Tannenbaum acquired 139,367 shares, paying $8.93 per share for a total amount of $1.24 billion. These shares were purchased indirectly through a trust.
• Chief Executive Officer Patrick J. Dalton acquired 11,500 shares, paying $8.88 per share for a total amount of $102,120.
• Director Bernard D. Berman acquired 10,000 shares, paying $8.88 per share for a total amount of $88,794. Mr. Berman increased his stake by 11.98% to 93,500 shares with this purchase.
• Director Richard W. Cohen acquired 2,000 shares, paying $8.86 per share for a total amount of $17,720. Mr. Cohen increased his stake by 18.18% to 13,000 shares with this purchase.
• Director Richard P. Dutkiewicz acquired 1,000 shares, paying $8.68 per share for a total amount of $8,677. Mr. Dutkiewicz increased his stake by 25.00% to 5,000 shares with this purchase.

You can view the list of recent insider transactions for Fifth Street Senior Floating Rate Corp. here.

5. Murphy USA Inc. (MUSA): $65.1

Director David B. Miller acquired 15,298 shares of this gas stations operator, paying $65.37 per share for a total amount of $1 million. Mr. Miller increased his stake by 76.49% to 35,298 shares with this purchase.

You can view the list of recent insider transactions for Murphy USA Inc. here.

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

Notable Insider Sales:

1. Facebook, Inc. (FB): $133.53

Shares of Facebook were sold by 3 insiders:

• Chief Operating Officer Sheryl Sandberg sold 327,000 shares for $133.39, generating $43.62 million from the sale. 29,338 of these shares were sold as a result of exercising options immediately prior to the sale.
• Chief Technology Officer Michael Todd Schroepfer sold 37,964 shares for $133.52, generating $5.07 million from the sale.
• VP and General Counsel Colin Stretch sold 750 shares for $133.90, generating $100,421 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 Facebook, Inc. here.

2. Lear Corporation (LEA): $142.37

Shares of this auto parts company were sold by 9 insiders:

• President & CEO Matthew Simoncini sold 96,980 shares for $142.71, generating $13.84 million from the sale.
• EVP, Business Development & General Counsel Terrence B. Larkin sold 31,084 shares for $142.70, generating $4.44 million from the sale.
• EVP & President, Seating Raymond E. Scott sold 28,820 shares for $142.70, generating $4.11 million from the sale.
• Sr. VP and CFO Jeffrey H. Vanneste sold 27,791 shares for $142.70, generating $3.97 million from the sale.
• Sr. VP & President, EPMS Frank C. Orsini sold 21,115 shares for $142.70, generating $3.01 million from the sale.
• Sr VP, Human Resources Thomas A. Didonato sold 17,374 shares for $142.70, generating $2.48 million from the sale.
• VP Treas & Chief Diversity Off Shari L. Burgess sold 8,233 shares for $142.70, generating $1.17 million from the sale.
• VP, Corporate Controller & CAO James L. Murawski sold 6,590 shares for $142.70, generating $940,371 from the sale.
• President, Asia Pacific Ops Jay K. Kunkel sold 6,347 shares for $142.70, generating $905,697 from the sale.

You can view the list of recent insider transactions for Lear Corporation here.

3. The Charles Schwab Corporation (SCHW): $41.55

Shares of this investment brokerage were sold by 2 insiders:

• Chairman Charles R. Schwab sold 738,000 shares for $41.58, generating $30.68 million from the sale. These shares were sold indirectly through a trust.
• Director Mark A. Goldfarb sold 15,688 shares for $40.94, generating $642,228 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 The Charles Schwab Corporation here.

4. Masimo Corporation (MASI): $84.11

Shares of this medical technology company were sold by 3 insiders:

• CEO and Chairman of the Board Joe E. Kiani sold 300,000 shares for $80.04, generating $24.01 million from the sale. These shares were sold indirectly through a trust.
• EVP & Chief Financial Officer Mark de Raad sold 45,000 shares for $80.00, generating $3.6 million from the sale. These shares were sold as a result of exercising options immediately prior to the sale.
• Pres, WW OEM Business Rick Fishel sold 30,000 shares for $79.90, generating $2.39 million 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 Masimo Corporation here.

5. NCR Corporation (NCR): $46.78

Shares of this consumer transaction solutions provider were sold by 4 insiders:

• Chairman and CEO William Nuti sold 386,637 shares for $45.80, generating $17.71 million from the sale.
• Director Gary James Daichendt sold 10,404 shares for $46.11, generating $479,728 from the sale. These shares were sold as a result of exercising options immediately prior to the sale.
• EVP, Global Services Frederick Marquardt sold 3,905 shares for $45.78, generating $178,771 from the sale. These shares were sold as a result of exercising options immediately prior to the sale.
• SVP, GC & Secy Edward R. Gallagher sold 1,156 shares for $45.78, generating $52,922 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 NCR Corporation here.

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

Disclaimer: I hold a longposition in Twitter (TWTR). Please do your own due diligence before buying or selling any securities mentioned in this article. We do not warrant the completeness or accuracy of the content or data provided in this article.

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