Insider Weekends – Two Insiders of Prospect Capital Continue Buying

Welcome to edition 393 of Insider Weekends and the last update for this year. What an amazing year this was for investors. We saw the S&P 500 increase 19.42% for the year without a single monthly drop much to the delight of traders who sold protection or sold volatility short. For some of us that purchased insurance on portfolios in the form of S&P 500 put options, while the premium was low, it took a bite out of performance. This year was not just kind to US investors but a global rally saw every major market in Europe, Asia and Latin America end up in the green. With tax reform providing relief to most tax payers and especially corporations, many strategists are seeing strong growth and earnings in the year ahead. It remains to be seen how much of this is baked into the market and how much propels this aging bull market to new highs.

With the normal slowdown we see at the end of each quarter, insider buying declined last week with insiders purchasing $28.43 million of stock compared to $85.3 million in the week prior. Selling also declined sharply with insiders selling $314.96 million of stock last week compared to $1.37 billion 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 dropped to 11.08. In other words, insiders sold more than 11 times as much stock as they purchased. The Sell/Buy ratio this week compares favourably with the prior week, when the ratio stood at 16.03.

Insider Sell Buy Ratio December 29, 2017

Insider Sell Buy Ratio December 29, 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. Prospect Capital Corporation (PSEC): $6.74

Shares of this business development company were acquired by 2 insiders:

  • Chief Executive Officer John F. Barry acquired 1,672,332 shares, paying $7.16 per share for a total amount of $11.97 million. Mr. Barry increased his stake by 5.39% to 32,678,164 shares with this purchase.
  • Chief Operating Officer Grier M. Eliasek acquired 20,000 shares, paying $7.13 per share for a total amount of $142,699. Mr. Eliasek increased his stake by 1.69% to 1,202,196 shares with this purchase.

The CEO and COO of Prospect Capital have been buying stock for several weeks in a row. The SIRF report article titled Prospect Capita: The Enemy Within provides a great overview of some of the challenges the company has been facing as the stock lost nearly half its value over the last four years.

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

P/E: 8.13 Forward P/E: 9.23 Industry P/E: 17.55
P/S: 4.15 Price/Book: 0.73 EV/EBITDA: 13.33
Market Cap: $2.43B Avg. Daily Volume: 3,848,663 52 Week Range: $5.51 – $9.58

2. Omega Healthcare Investors, Inc. (OHI): $27.54

Director Bernard J. Korman acquired 100,000 shares of this healthcare REIT, paying $26.89 per share for a total amount of $2.69 million. Mr. Korman increased his stake by 11.15% to 996,895 shares with this purchase.

You can view the list of recent insider transactions for Omega Healthcare Investors, Inc. here.

P/E: 33.46 Forward P/E: 15.47 Industry P/E: 35.04
P/S: 6.18 Price/Book: 1.51 EV/EBITDA: 15.42
Market Cap: $5.7B Avg. Daily Volume: 2,763,196 52 Week Range: $26.43 – $35.14

3. Biglari Holdings Inc. (BH): $414.4

Director Sardar Biglari, acquired 3,493 shares of this holding company, paying $419.09 per share for a total amount of $1.46 million. These shares were purchased indirectly by The Lion Fund.

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

P/E: 9.86 Forward P/E: -89.7 Industry P/E: 53.91
P/S: 1.02 Price/Book: 1.68 EV/EBITDA: 33.12
Market Cap: $856.82M Avg. Daily Volume: 7,123 52 Week Range: $290.05 – $490

4. Air T, Inc. (AIRT): $24.65

CEO Nicholas John Swenson acquired 52,742 shares of this air transportation company, paying $24.74 per share for a total amount of $1.3 million. These shares were purchased indirectly by Groveland Hedged Credit Fund.

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

P/E: 17.75 Forward P/E: N/A Industry P/E: 11.62
P/S: 0.29 Price/Book: 2.08 EV/EBITDA: 9.25
Market Cap: $50.35M Avg. Daily Volume: 2,323 52 Week Range: $14.4 – $25

5. Spark Energy, Inc. (SPKE): $12.4

Director Keith W. Maxwell III acquired 36,600 shares of this supplier and retailer of electricity and natural gas, paying $12.00 per share for a total amount of $439,245. Mr. Maxwell increased his stake by 3.84% to 988,722 shares with this purchase.

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

P/E: 14.81 Forward P/E: 15.31 Industry P/E: 14.41
P/S: 0.59 Price/Book: 4.52 EV/EBITDA: 2.62
Market Cap: $429.42M Avg. Daily Volume: 182,444 52 Week Range: $10.7 – $23.65

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

Notable Insider Sales:

1. Monster Beverage Corporation (MNST): $63.29

Shares of this beverage company were sold by 2 insiders:

  • Chairman and CEO Rodney C. Sacks sold 189,861 shares for $63.92, generating $12.14 million from the sale. 147,312 of these shares were sold indirectly by Hilrod Holdings XVI, L.P.
  • Vice Chairman and President Hilton H. Schlosberg sold 189,861 shares for $63.79, generating $12.11 million from the sale. 147,312 of these shares were sold indirectly by Hilrod Holdings XVI, L.P.

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

P/E: 46.2 Forward P/E: 36.8 Industry P/E: 41.75
P/S: 10.78 Price/Book: 9.47 EV/EBITDA: 26.57
Market Cap: $35.69B Avg. Daily Volume: 1,834,080 52 Week Range: $41.02 – $64.79

2. Twitter, Inc. (TWTR): $24.01

Director Evan Clark Williams sold 546,200 shares of Twitter for $24.29, generating $13.26 million from the sale. These shares were sold indirectly through various trusts and entities.

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

P/E: N/A Forward P/E: 53.36 Industry P/E: 33.56
P/S: 7.31 Price/Book: 3.67 EV/EBITDA: 68.48
Market Cap: $17.76B Avg. Daily Volume: 19,308,136 52 Week Range: $14.12 – $25.56

3. Carnival plc (CUK): $66.28

Shares of this global cruise and vacation company were sold by 4 insiders:

  • CEO, Holland America Group Stein Kruse sold 60,665 shares for $66.59, generating $4.04 million from the sale.
  • CFO & CAO David Bernstein sold 51,454 shares for $66.76, generating $3.44 million from the sale.
  • CEO – Costa Crociere Michael Olaf Thamm sold 28,000 shares for $66.59, generating $1.86 million from the sale.
  • General Counsel & Secretary Arnaldo Perez sold 15,166 shares for $66.59, generating $1 million from the sale.

You can view the list of recent insider transactions for Carnival plc here.

P/E: 18.46 Forward P/E: 16.33 Industry P/E: 76.35
P/S: 2.59 Price/Book: 1.97 EV/EBITDA: N/A
Market Cap: $45.4B Avg. Daily Volume: 289,893 52 Week Range: $50.88 – $70.56

4. Accenture plc (ACN): $153.09

Shares of Accenture were sold by 7 insiders:

  • Chairman & CEO Pierre Nanterme sold 34,232 shares for $152.94, generating $5.24 million from the sale.
  • Group Chief Exec-North America Julie Spellman Sweet sold 10,097 shares for $152.93, generating $1.54 million from the sale.
  • Chief Operating Officer Johan Deblaere sold 5,000 shares for $152.92, generating $764,586 from the sale.
  • General Counsel and CCO Chad T. Jerdee sold 5,000 shares for $152.92, generating $764,608 from the sale.
  • Group Chief Exec-Growth Mkts Gianfranco Casati sold 5,000 shares for $152.92, generating $764,582 from the sale.
  • Grp Chief Exec-Com, Med & Tech Robert E. Sell sold 3,750 shares for $152.92, generating $573,453 from the sale.
  • Group Chief Exec-Resources Jean-marc Ollagnier sold 1,553 shares for $152.90, generating $237,460 from the sale.

You can view the list of recent insider transactions for Accenture plc here.

P/E: 27.13 Forward P/E: 21.15 Industry P/E: 56.82
P/S: 2.63 Price/Book: 10.35 EV/EBITDA: 15.54
Market Cap: $94.41B Avg. Daily Volume: 1,846,292 52 Week Range: $112.31 – $158.44

5. IAC/InterActiveCorp (IAC): $122.28

EVP and GC Gregg Winiarski sold 27,747 shares of this media and Internet services provider for $127.03, generating $3.52 million from the sale.

You can view the list of recent insider transactions for IAC/InterActiveCorp here.

P/E: 29.94 Forward P/E: 23.84 Industry P/E: 33.56
P/S: 3.16 Price/Book: 4.12 EV/EBITDA: 30.72
Market Cap: $10.03B Avg. Daily Volume: 915,074 52 Week Range: $65.4 – $137.86

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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