Welcome to edition twenty of Insider Weekends. Insider buying increased slightly last week with insiders purchasing $3.05 million of their stock when compared to $2.53 million in the week prior. Selling on the other hand decreased with insiders selling $567.34 million worth of stock when compared to $664.15 million in the week prior.
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 186.1. In other words, insiders sold almost 186 times as much stock as they purchased. The Sell/Buy ratio this week compares favorably with the week prior when the ratio stood at 262.22. I removed a $5 million indirect purchase by Alfred Mann, the CEO of MannKind (MNKD), which looked like a insider purchase but was a debt for stock swap between MannKind and another company called The Mann Group. Retaining this purchase would have pushed the Sell/Buy Ratio all the way down to 70. 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. Monsanto Co. (MON): $57.15
Chairman, President & CEO Hugh Grant acquired 18,000 shares of this agricultural products company, paying $56.36 per share for a total amount of $1.01 million. The previous purchase by the CEO and CFO in mid-July for $52 per share triggered a nice rally in the shares but given the current market conditions, I think the reaction to this purchase might be muted this time.
|P/E: 28.39||Forward P/E: 17.32||Industry P/E: N/A|
|P/S: 2.98||Price/Book: 3.1||EV/EBITDA: 12.44|
|Market Cap: $30.90B||Avg. Daily Volume: 7,493,200||52 Week Range: $44.61 – $87.06|
2. Intel Corporation (INTC): $19.835
Shares of this semiconductor company were acquired by two insiders:
|P/E: 10.67||Forward P/E: 10.28||Industry P/E: N/A|
|P/S: 2.58||Price/Book: 2.31||EV/EBITDA: 4.29|
|Market Cap: $110.58B||Avg. Daily Volume: 70,463,500||52 Week Range: $17.6 – $24.37|
3. General Electric Co. (GE): $16.055
Vice Chairman Michael Neal acquired 20,553 shares of GE, paying $16.23 per share for a total amount of $333,575.
|P/E: 17.51||Forward P/E: 12.64||Industry P/E: N/A|
|P/S: 1.14||Price/Book: 1.49||EV/EBITDA: 24.78|
|Market Cap: $171.37B||Avg. Daily Volume: 61,804,900||52 Week Range: $13.75 – $19.7|
4. Alcoa, Inc. (AA): $12.72
Director James Owens acquired 10,000 shares of this aluminum manufacturing company, paying $12.73 per share for a total amount of $127,300.
Mr. Owens was the former CEO of Caterpillar (CAT) and has been a director of Alcoa since 2005.
|P/E: N/A||Forward P/E: 11.89||Industry P/E: N/A|
|P/S: 0.63||Price/Book: 0.98||EV/EBITDA: 10.2|
|Market Cap: $12.99B||Avg. Daily Volume: 25,324,900||52 Week Range: $9.81 – $17.6|
5. Oil-Dri Corp. of America (ODC): $21.92
Director Allan Selig acquired 5,000 shares of this specialty chemicals company, paying $20.46 per share for a total amount of $102,308.
|P/E: 16.91||Forward P/E: 14.23||Industry P/E: 16.39|
|P/S: 0.69||Price/Book: 1.67||EV/EBITDA: 7.04|
|Market Cap: $153.51M||Avg. Daily Volume: 13,935||52 Week Range: $14.75 – $23.53|
Notable Insider Sales:
1. Google Inc. (GOOG): $612.53
Shares of Google were sold by three insiders:
50,000 of the shares Mr. Shriram sold were sold indirectly by his spouse. 85,914 of his shares were sold from two trusts. 956 of the shares Mr. Arora sold were as a result of exercising options immediately prior to the sale. Ms. Mather’s sale was related to the vesting of Google Stock Units (“GSUs”).
|P/E: 24.88||Forward P/E: 18.44||Industry P/E: N/A|
|P/S: 7.08||Price/Book: 4.5||EV/EBITDA: 14.56|
|Market Cap: $195.16B||Avg. Daily Volume: 2,965,190||52 Week Range: $433.63 – $629.51|
2. Oracle Corp. (ORCL): $28.9925
Shares of this enterprise software company were sold by four insiders:
With the exception of Mr. Ellison’s shares, all other sales were as a result of exercising options immediately prior to the sale.
|P/E: 23.14||Forward P/E: 13.24||Industry P/E: N/A|
|P/S: 4.95||Price/Book: 4.51||EV/EBITDA: 11.05|
|Market Cap: $145.75B||Avg. Daily Volume: 36,454,600||52 Week Range: $20.65 – $29.24|
3. EMC Corporation (EMC): $21.44
Shares of this data storage devices company were sold by four insiders:
|P/E: 30.45||Forward P/E: 14.89||Industry P/E: N/A|
|P/S: 2.82||Price/Book: 2.7||EV/EBITDA: 13.56|
|Market Cap: $44.03B||Avg. Daily Volume: 26,919,800||52 Week Range: $16.12 – $21.83|
4. Nxstage Medical, Inc. (NXTM): $21.68
Shares of this medical device company were sold by four insiders:
|P/E: N/A||Forward P/E: N/A||Industry P/E: 21.6|
|P/S: 6.35||Price/Book: 13.14||EV/EBITDA: -114.99|
|Market Cap: $1.05B||Avg. Daily Volume: 430,324||52 Week Range: $5.38 – $21.98|
5. Illinois Tool Works Inc. (ITW): $46.69
Director Robert McCormack sold 108,400 shares of this diversified machinery company for $46.38 per share for a total amount of $5.03 million. Mr. McCormack’s shares were sold indirectly through a trust.
|P/E: 15.44||Forward P/E: 12.9||Industry P/E: 20.87|
|P/S: 1.58||Price/Book: 2.72||EV/EBITDA: 9.47|
|Market Cap: $23.51B||Avg. Daily Volume: 4,384,150||52 Week Range: $40.33 – $52.72|
Voluntary Disclosure: I have a long position in Monsanto (MON) in my trading portfolio. I hold a long position in Intel (INTC) in a long-term portfolio.