Insider Weekends – First Insider Purchase at G-III in Nearly Four Years

Welcome to edition 355 of Insider Weekends. Insider buying decreased with insiders buying $5.99 million of stock compared to $77.54 million in the week prior. Selling on the other hand increased with insiders selling $712.03 million of stock last week compared to $514.22 million in the week prior. We normally see a seasonal drop in insider transactions at the start of each quarter and while this $6 million in insider purchases appears low, we also saw just $4 million in purchases in the first week of January. Looking back over the last five years, this has been the lowest level of insider purchases in the first week of April, which has ranged from a low of $7.57 million in 2016 to as high as $50.3 million in 2012.

While insider buying was dull, the natural beauty of the Sierra Nevada region with ample snow this Spring was stunning. A couple of pictures from a trip to Lake Tahoe last weekend are given below.

Lake Tahoe Keys

Lake Tahoe Keys

Sierra Nevada Region

Sierra Nevada Region

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 118.82. In other words, insiders sold almost 119 times as much stock as they purchased. The Sell/Buy ratio this week compares unfavorably with the prior week, when the ratio stood at 6.63.

Insider Sell Buy Ratio April 7, 2017

Insider Sell Buy Ratio April 7, 2017

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. G-III Apparel Group, Ltd. (GIII): $24.43

CEO Morris Goldfarb acquired 39,689 shares of this apparel company, paying $22.13 per share for a total amount of $878,345. Mr. Goldfarb increased his stake by 1.02% to 3,912,586 shares with this purchase.

This is the first insider purchase we have seen at G-III in nearly four years. G-III markets products under its proprietary brands like G.H. Bass, DKNY, Andrew Marc, etc. and also licenses its products under Calvin Klein, Tommy Hilfiger, Guess?, Kenneth Cole NY, Cole Haan, Levi’s and several other brands. The stock has seen a sharp decline over the last two years, dropping from a split-adjusted high of over $72 in July 2015 to a low of $19.11 last month. Mr. Goldfarb was a consistent seller of the stock in 2013, 2014 and 2015 at prices as high as $70.77 as you can see here.

The stock appears to be cheaper than peers like V.F. Corporation (VFC) on metrics such as Price/Sales and EV/EBITDA but it also does not enjoy the kind of margins V.F. does with its brands like The North Face, Timberland and Nautica, amongst many others. G-III also does not pay a dividend, which could provide some returns to investors while they wait for the dust to settle in the storm apparel and retail companies find themselves in.

You can view the list of recent insider transactions for G-III Apparel Group, Ltd. here.

P/E: 14.33 Forward P/E: 17.33 Industry P/E: 33.73
P/S: 0.5 Price/Book: 1.16 EV/EBITDA: 9.18
Market Cap: $1.19B Avg. Daily Volume: 884,882 52 Week Range: $19.11 – $51.81

2. Opko Health, Inc. (OPK): $7.59

CEO & Chairman Phillip Frost M.D. acquired 103,900 shares of this devices and drug development company, paying $7.69 per share for a total amount of $799,174. 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: -165 Forward P/E: 94.88 Industry P/E: 28.98
P/S: 3.47 Price/Book: 2.02 EV/EBITDA: 62.24
Market Cap: $4.24B Avg. Daily Volume: 4,458,300 52 Week Range: $7.13 – $12.15

3. Seritage Growth Properties (SRG): $42.08

10% owner Bruce R. Berkowitz purchased 18,200 shares of this retail REIT, paying $42.00 per share for a total amount of $764,400. These shares were acquired in accounts managed indirectly by Mr. Berkowitz.

You can view the list of recent insider transactions for Seritage Growth Properties here.

P/E: -25.64 Forward P/E: 19.3 Industry P/E: 29.91
P/S: 9.29 Price/Book: 1.65 EV/EBITDA: 14.92
Market Cap: $2.35B Avg. Daily Volume: 400,914 52 Week Range: $39.6 – $57.31

4. PolarityTE, Inc. (COOL): $14.85

Director Michael Martin Beeghley acquired 20,000 shares of this tissue regeneration platform provider, paying $13.36 per share for a total amount of $267,200. These shares were purchased indirectly by Applied Economics LLC Profit Sharing Plan.

COOL has seen its stock price increase more than 400% over the last five months after this former creator of video games decided to acquire tissue regeneration company PolarityTE, changed its name from Majesco and exited the video game business.

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

P/E: -3.87 Forward P/E: N/A Industry P/E: 37.27
P/S: 54.82 Price/Book: N/A EV/EBITDA: -4.85
Market Cap: $60.69M Avg. Daily Volume: 151,517 52 Week Range: $2.61 – $18.9

5. Washington Prime Group Inc. (WPG): $8.64

Chief Executive Officer Louis G. Conforti acquired 28,700 shares of this property management company, paying $8.68 per share for a total amount of $249,116.

You can view the list of recent insider transactions for Washington Prime Group Inc. here.

P/E: 30.21 Forward P/E: 27.87 Industry P/E: 29.91
P/S: 2.26 Price/Book: 1.8 EV/EBITDA: 10.16
Market Cap: $1.91B Avg. Daily Volume: 2,125,947 52 Week Range: $7.89 – $14.15

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

Notable Insider Sales:

1. Facebook, Inc. (FB): $140.78

Shares of Facebook were sold by 3 insiders:

  • COB and CEO Mark Zuckerberg sold 368,809 shares for $142.35, generating $52.49 million from the sale. These shares were sold indirectly through various entities.
  • Chief Operating Officer Sheryl Sandberg sold 272,500 shares for $141.35, generating $38.52 million from the sale. 131,000 of these shares were sold as a result of exercising options immediately prior to the sale.
  • VP and General Counsel Colin Stretch sold 750 shares for $141.77, generating $106,331 from the sale.

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

P/E: 40.3 Forward P/E: 21.04 Industry P/E: 37.27
P/S: 14.72 Price/Book: 6.86 EV/EBITDA: 25.44
Market Cap: $406.85B Avg. Daily Volume: 17,269,614 52 Week Range: $106.31 – $143.44

2. Take-Two Interactive Software, Inc. (TTWO): $58.47

Chairman, CEO Strauss Zelnick sold 387,237 shares of this videogame company for $57.98, generating $22.45 million from the sale. These shares were sold indirectly by Zelnick Media Corporation.

You can view the list of recent insider transactions for Take-Two Interactive Software, Inc. here.

P/E: 350.12 Forward P/E: 20.81 Industry P/E: 35.84
P/S: 3.74 Price/Book: 6.44 EV/EBITDA: 56.39
Market Cap: $5.93B Avg. Daily Volume: 1,673,482 52 Week Range: $33.06 – $60.2

3. Copart, Inc. (CPRT): $59.68

Chief Executive Officer Jayson A. Adair sold 200,000 shares of this online auctions and vehicle remarketing services provider for $62.06, generating $12.41 million from the sale. These shares were sold indirectly through a trust.

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

P/E: 18.07 Forward P/E: 21.31 Industry P/E: 25.77
P/S: 4.98 Price/Book: 7.65 EV/EBITDA: 15.13
Market Cap: $6.85B Avg. Daily Volume: 510,560 52 Week Range: $40.7 – $63.14

4. Apple Inc. (AAPL): $143.34

Shares of Apple were sold by 3 insiders:

  • Senior Vice President Philip W. Schiller sold 47,796 shares for $143.32, generating $6.85 million from the sale. These shares were sold as a result of exercising options immediately prior to the sale.
  • Senior Vice President, CFO Luca Maestri sold 20,307 shares for $145.05, generating $2.95 million from the sale.
  • Senior Vice President Daniel J. Riccio sold 11,949 shares for $143.98, generating $1.72 million from the sale.

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

P/E: 17.21 Forward P/E: 14.12 Industry P/E: 13.37
P/S: 3.45 Price/Book: 5.69 EV/EBITDA: 11.17
Market Cap: $752.04B Avg. Daily Volume: 27,003,790 52 Week Range: $89.47 – $145.46

5. Twitter, Inc. (TWTR): $14.29

Shares of Twitter were sold by 2 insiders:

  • Director Evan Clark Williams sold 546,600 shares for $14.71, generating $8.04 million from the sale. These shares were sold indirectly through various trusts.
  • General Counsel Vijaya Gadde sold 15,000 shares for $14.71, generating $220,698 from the sale.

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

P/E: -21.95 Forward P/E: 36.64 Industry P/E: 37.27
P/S: 4.08 Price/Book: 2.22 EV/EBITDA: 132.18
Market Cap: $10.31B Avg. Daily Volume: 17,649,504 52 Week Range: $13.73 – $25.25

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

Disclaimer: I hold a long position 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.

Connect with me on LinkedIn: http://www.linkedin.com/in/asifsuria or follow me on Twitter @asifsuria

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