Insider Weekends – Insiders of Two Retail REITs Buy Stock

Welcome to edition 359 of Insider Weekends. Insider buying decreased with insiders buying $106.38 million of stock compared to $318.69 million in the week prior. Selling increased more than tenfold with insiders selling $4.63 billion of stock last week compared to $400.52 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 spiked to 43.28. In other words, insiders sold more than 43 times as much stock as they purchased. The Sell/Buy ratio this week compares unfavorably with the prior week, when the ratio stood at 1.26.

Insider Sell Buy Ratio May 5, 2017

Insider Sell Buy Ratio May 5, 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. Carvana Co. (CVNA): $10.92

Shares of this e-commerce platform for buying used cars were acquired by 4 insiders:

  • 10% Owner Ernest C. Garcia II acquired 1,664,517 shares, paying $12.9 per share for a total amount of $21.48 million.
  • Chief Executive Officer Ernest C. Garcia III acquired 183,333 shares, paying $13.35 per share for a total amount of $2.45 million.
  • Chief Brand Officer Ryan S. Keeton acquired 6,000 shares, paying $9.25 per share for a total amount of $55,500.
  • Controller John T. McKeon acquired 181 shares, paying $10.93 per share for a total amount of $1,978.

Carvana went public on April 28th at a price of $15 and some of these insider purchases were related to purchases in the IPO. We normally tend not to feature IPO related purchases but decided to make an exception in this case. The IPO was not very well received and the stock dropped as low as $8.14 on May 4th. All of these insiders also purchased shares on the open market after the stock had dropped a lot. As investors in TrueCar (TRUE) have realized, getting in early in some of these businesses can translate into a lucrative but also a very volatile ride.

You can view the list of recent insider transactions for Carvana Co. here.

P/E: -9.92 Forward P/E: N/A Industry P/E: 26.09
P/S: N/A Price/Book: N/A EV/EBITDA: N/A
Market Cap: $1.82B Avg. Daily Volume: 3,408,606 52 Week Range: $8.14 – $13.94

2. Biogen Inc. (BIIB): $262.15

Shares of this biotech company were acquired by 2 insiders:

  • Director Alexander J. Denner acquired 73,858 shares, paying $278.50 per share for a total amount of $20.57 million. These shares were acquired indirectly through a fund.
  • Chief Executive Officer Michel Vounatsos acquired 1,402 shares, paying $271.35 per share for a total amount of $380,433. Mr. Vounatsos increased his stake by 91.93% to 2,927 shares with this purchase.

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

P/E: 16.42 Forward P/E: 11.58 Industry P/E: 13.51
P/S: N/A Price/Book: 4.84 EV/EBITDA: N/A
Market Cap: $56B Avg. Daily Volume: 1,618,595 52 Week Range: $223.02 – $333.65

3. DDR Corp. (DDR): $9.89

Shares of this shopping center REIT were acquired by 2 insiders:

  • Director Alexander Otto acquired 500,000 shares, paying $10.92 per share for a total amount of $5.46 million. Mr. Otto increased his stake by 1.15% to 44,009,893 shares with this purchase.
  • Director Thomas Finne acquired 2,000 shares, paying $11.05 per share for a total amount of $22,110. Mr. Finne increased his stake by 3.85% to 54,000 shares with this purchase.

The 52 week low list had recently been dominated by retail REITs as they face two strong headwinds in the form of rising interest rates and the shutting down of a record number of physical retail stores. I have been watching this group of about 25 companies with a lot of interest and insider purchases within the group may be one indicator of whether it is time to start fishing in this pond. Significant insider sales despite a decline in the stock as we saw in the case of the retail REIT Regency Centers Corporation (REG) in early March give me pause.

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

P/E: -57.5 Forward P/E: 247.25 Industry P/E: 28.34
P/S: N/A Price/Book: 1.31 EV/EBITDA: N/A
Market Cap: $3.61B Avg. Daily Volume: 5,726,296 52 Week Range: $9.61 – $19.92

4. Agree Realty Corporation (ADC): $46.02

Shares of this retail REIT were acquired by 2 insiders:

  • Executive Chairman of Board Richard Agree acquired 25,000 shares, paying $44.73 per share for a total amount of $1.12 million. Mr. Agree increased his stake by 5.53% to 477,016 shares with this purchase.
  • Director John Rakolta Jr. acquired 10,000 shares, paying $44.82 per share for a total amount of $448,200. Mr. Rakolta increased his stake by 6.28% to 169,133 shares with this purchase.

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

P/E: 21.36 Forward P/E: 26.76 Industry P/E: 28.34
P/S: N/A Price/Book: 1.75 EV/EBITDA: N/A
Market Cap: $1.21B Avg. Daily Volume: 189,591 52 Week Range: $40.52 – $51.5

5. Cliffs Natural Resources Inc. (CLF): $6.28

Shares of this mining and natural resources company were acquired by 8 insiders:

  • Chairman, President & CEO Lourenco Goncalves acquired 200,000 shares, paying $6.31 per share for a total amount of $1.26 million. Mr. Goncalves increased his stake by 7.53% to 2,855,296 shares with this purchase.
  • Director Gabriel Stoliar acquired 7,100 shares, paying $6.90 per share for a total amount of $48,990. Mr. Stoliar increased his stake by 6.07% to 124,024 shares with this purchase.
  • Director John T. Baldwin acquired 6,000 shares, paying $6.32 per share for a total amount of $37,902. Mr. Baldwin increased his stake by 7.32% to 87,991 shares with this purchase.
  • Director Michael D. Siegal acquired 5,000 shares, paying $6.86 per share for a total amount of $34,294. These shares were purchased indirectly through a trust.
  • Director Robert P. Fisher acquired 4,000 shares, paying $6.83 per share for a total amount of $27,314. Mr. Fisher increased his stake by 5.39% to 78,186 shares with this purchase.
  • Director Douglas C. Taylor acquired 3,750 shares, paying $6.61 per share for a total amount of $24,771. These shares were purchased indirectly through a trust.
  • Director Eric M. Rychel acquired 3,000 shares, paying $6.55 per share for a total amount of $19,648. Mr. Rychel increased his stake by 25.33% to 14,845 shares with this purchase.
  • Director Joseph A. Rutkowski acquired 2,500 shares, paying $6.77 per share for a total amount of $16,925. Mr. Rutkowski increased his stake by 3.05% to 84,567 shares with this purchase.

You can view the list of recent insider transactions for Cliffs Natural Resources Inc. here.

P/E: 36.73 Forward P/E: 6.9 Industry P/E: 19.92
P/S: N/A Price/Book: N/A EV/EBITDA: N/A
Market Cap: $1.86B Avg. Daily Volume: 21,822,337 52 Week Range: $2.77 – $12.37

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

Notable Insider Sales:

1. Microsoft Corporation (MSFT): $69

Shares of Microsoft were sold by 3 insiders:

  • Founder Bill Gates sold 8,000,000 shares for $69.17, generating $553.39 million from the sale.
  • Director Mason G. Morfit sold 7,000,000 shares for $68.85, generating $481.95 million from the sale. These shares were sold indirectly  by ValueAct Capital Master Fund.
  • Executive Vice President Jean Philippe Courtois sold 26,694 shares for $69.00, generating $1.84 million from the sale.

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

P/E: 30.46 Forward P/E: 20.78 Industry P/E: 31.05
P/S: N/A Price/Book: 7.64 EV/EBITDA: N/A
Market Cap: $532.72B Avg. Daily Volume: 21,821,433 52 Week Range: $48.04 – $69.71

2. Amazon.com, Inc. (AMZN): $934.15

Shares of Amazon were sold by 3 insiders:

  • Chairman, CEO and President Jeffrey P. Bezos sold 1,000,000 shares for $940.74, generating $940.74 million from the sale.
  • Director Tom A. Alberg sold 670 shares for $940.45, generating $630,102 from the sale.
  • Senior Vice President David Zapolsky sold 505 shares for $946.59, generating $478,028 from the sale.

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

P/E: 175.92 Forward P/E: 80.18 Industry P/E: 64
P/S: 3.13 Price/Book: 20.6 EV/EBITDA: 35.94
Market Cap: $446.5B Avg. Daily Volume: 3,196,853 52 Week Range: $671.41 – $954.4

3. Facebook, Inc. (FB): $150.24

Shares of Facebook were sold by 3 insiders:

  • Director Jan Koum sold 3,200,000 shares for $150.27, generating $480.86 million from the sale. These shares were sold indirectly through a trust.
  • Chief Financial Officer David M. Wehner sold 20,000 shares for $149.90, generating $2.99 million from the sale.
  • VP and General Counsel Colin Stretch sold 750 shares for $153.17, generating $114,880 from the sale.

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

P/E: 43.01 Forward P/E: 22.36 Industry P/E: 36.15
P/S: N/A Price/Book: 7.32 EV/EBITDA: N/A
Market Cap: $435.3B Avg. Daily Volume: 15,905,870 52 Week Range: $108.23 – $153.6

4. Apollo Global Management, LLC (APO): $26.45

Shares of this private equity firm were sold by 2 insiders:

  • Senior Managing Director Marc J. Rowan sold 1,250,000 shares for $26.61, generating $33.27 milliom from the sale. These shares were sold indirectly by MJR Foundation.
  • Chief Financial Officer Martin Kelly sold 10,000 shares for $26.77, generating $267,702 from the sale.

You can view the list of recent insider transactions for Apollo Global Management, LLC here.

P/E: 12.54 Forward P/E: 9.62 Industry P/E: 2
P/S: N/A Price/Book: 5.87 EV/EBITDA: N/A
Market Cap: $10.8B Avg. Daily Volume: 1,917,101 52 Week Range: $14.25 – $27.78

5. Juniper Networks, Inc. (JNPR): $30.55

Shares of this network infrastructure company were sold by 5 insiders:

  • Director Scott Kriens sold 1,000,000 shares for $30.09, generating $30.09 million from the sale. These shares were sold indirectly by a Foundation.
  • Director Mercedes Johnson sold 25,000 shares for $30.20, generating $754,967 from the sale.
  • Director Robert Calderoni sold 25,000 shares for $30.10, generating $752,413 from the sale.
  • EVP Chief Customer Officer Vincent Molinaro sold 4,597 shares for $30.00, generating $137,910 from the sale.
  • Corp VP Corp Controller & CAO Terrance F. Spidell sold 2,471 shares for $29.65, generating $73,265 from the sale.

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

P/E: 19.32 Forward P/E: 12.94 Industry P/E: 9.83
P/S: N/A Price/Book: 2.32 EV/EBITDA: N/A
Market Cap: $11.58B Avg. Daily Volume: 4,583,024 52 Week Range: $21.18 – $30.96

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

Disclaimer: 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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