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Welcome to edition seventeen of Insider Weekends. Insider buying increased last week with insiders purchasing $24.51 million of their stock when compared to $9.15 million in the week prior. Selling also increased with insiders selling $676.71 million worth of stock when compared to $605.14 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 buying in that week. The adjusted ratio for last week went down to 28. In other words, insiders sold 28 times as much stock as they purchased. The Sell/Buy ratio this week compares favorably with the week prior when the ratio stood at 66.12, the highest it had been in nearly 5 months. In case you were wondering why the ratio dropped so precipitously and why insider buying spiked last week, it had little to do with the conviction of insiders and more to do with insiders participating in stock offerings (CNBC, GEOY and FUR) and in one case a Director providing additional funding to an unprofitable company (VLNC). The ratio spikes to 121 if I remove these special events. 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.
Note: As mentioned in the first post in this series Introduction to Insider Weekends, 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. First Citizens Bancshares Inc. (FCNCA): $187.97
Executive Vice Chairman Frank Holding acquired 5,225 shares of this bank holding company, paying $187 per share for a total amount of $978,554.