Welcome to edition fifty nine of Insider Weekends. Insider buying decreased with insiders purchasing $13.32 million of their stock last week when compared to $28.71 million in the week prior. Selling on the other hand increased with insiders selling $508.82 million worth of stock compared to $400.06 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 went up to 38.2. In other words, insiders sold more than 38 times as much stock as they purchased. The Sell/Buy ratio this week compares unfavorably with the week prior when the ratio stood at 13.9. 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. Hasbro Inc. (HAS): $40.5
Shares of this toy manufacturer were acquired by 2 insiders:
- Senior Vice President and CFO Deborah Thomas acquired 5,000 shares, paying $39.50 per share for a total amount of $197,498. Ms. Thomas increased her stake by 16.62% to 35,091 shares with this purchase.
- President & CEO Brian Goldner acquired 5,000 shares, paying $39.55 per share for a total amount of $197,745. These shares were purchased indirectly through a trust.
Hasbro along with its close competitor Mattel (MAT) has weathered this recession very well and both companies still look attractive. Mattel has slightly better margins and a slightly higher dividend yield (3.4% vs. Hasbro’s 3%) but Hasbro has the upper hand when it comes to hollywood and television on account of its ownership of the Transformers brand. The company also operates a cable TV channel called “The Hub” in a joint venture with Discovery Communications (DISCA).
Hasbro is currently languishing near a 52 week low. The stock, which has been under pressure most of this month, fell an additional 5% last Monday after reporting quarterly results that came in below expectations despite a 43% jump in international revenue (before foreign exchange related impact). With double digit operating margins and a EV/EBITDA ratio of just 8.95, I like the company at current levels.
Voluntary Disclosure: I hold a long position in Hasbro.
You can view the list of recent insider transactions for Hasbro Inc. here.
|P/E: 15.36||Forward P/E: 11.54||Industry P/E: 13.05|
|P/S: 1.29||Price/Book: 3.66||EV/EBITDA: 8.75|
|Market Cap: $5.51B||Avg. Daily Volume: 1,520,660||52 Week Range: $38.77 – $50.17|
2. FuelCell Energy Inc. (FCEL): $1.46
Shares of this manufacturer of fuel cells were acquired by 3 insiders:
- Director John A. Rolls acquired 100,000 shares, paying $1.32 per share for a total amount of $132,000. Mr. Rolls increased his stake by 19.69% to 608,000 shares with this purchase.
- Chief Operating Officer Anthony Rauseo acquired 10,000 shares, paying $1.31 per share for a total amount of $13,100. Mr. Rauseo increased his stake by 4.16% to 250,458 shares with this purchase.
- President and CEO Arthur A. Bottone acquired 10,000 shares, paying $1.30 per share for a total amount of $12,997. Mr. Bottone increased his stake by 3.91% to 265,903 shares with this purchase.
Multiple insider purchases with participation by the management team near a 52 week low are generally noteworthy. However in this case, there is little to cheer as the company is steadily bleeding cash, the CFO resigned last month and the company is not even turning a gross profit. On the positive side revenue has been going up over the last two quarters and the company received its largest order ever of $129 million last month. Order backlogs are currently at $135.5 million. Net income for the previous quarter was adversely impacted by a couple of one-time charges.
You can view the list of recent insider transactions for FuelCell Energy Inc. here.
|P/E: N/A||Forward P/E: N/A||Industry P/E: 17.76|
|P/S: 1.95||Price/Book: N/A||EV/EBITDA: -3.35|
|Market Cap: $185.38M||Avg. Daily Volume: 2,274,400||52 Week Range: $0.98 – $2.41|
3. Unitedhealth Group, Inc. (UNH): $52.75
Director Rodger A. Lawson acquired 3,000 shares of this health insurance provider, paying $52.08 per share for a total amount of $156,230. Mr. Lawson increased his stake by 40.14% to 10,473 shares with this purchase.
You can view the list of recent insider transactions for Unitedhealth Group, Inc. here.
|P/E: 12.3||Forward P/E: 11.04||Industry P/E: 14.94|
|P/S: 0.59||Price/Book: 2.11||EV/EBITDA: 6.25|
|Market Cap: $57.15B||Avg. Daily Volume: 7,562,550||52 Week Range: $29.94 – $53.5|
4. MEDTOX Scientific Inc. (MTOX): $15.32
President/CEO/Chairman Richard J. Braun acquired 10,000 shares of this forensic and clinical laboratory services provider, paying $14.57 per share for a total amount of $145,690. Mr. Braun increased his stake by 2.00% to 510,401 shares with this purchase.
You can view the list of recent insider transactions for MEDTOX Scientific Inc. here.
|P/E: 33.23||Forward P/E: 18.91||Industry P/E: 19.58|
|P/S: 1.31||Price/Book: 2.49||EV/EBITDA: 10.92|
|Market Cap: $135.54M||Avg. Daily Volume: 56,686||52 Week Range: $10.8 – $19.21|
5. Kingold Jewelry, Inc. (KGJI): $1.83
CEO and Chairman Jia Zhi Hong acquired 70,000 shares of this gold jewelry manufacturer, paying $1.72 per share for a total amount of $120,400. Mr. Hong increased his stake by 0.40% to 17,630,194 shares with this purchase. Following the last group of purchases by the CEO of Kingold Jewelry two weeks ago, the stock shot up 29% in a day last Monday but has given back some of those gains.
I wrote the following a couple of weeks ago, “Kingold has take quite the beating this year along with other Chinese reverse merger companies, falling from a high of $10.60 last September to current levels. Interactive Brokers has a list of Chinese reverse merger companies that are subject to 100% margin requirements and you can find the list here”
You can view the list of recent insider transactions for Kingold Jewelry, Inc. here.
|P/E: 4.26||Forward P/E: N/A||Industry P/E: 24.29|
|P/S: 0.15||Price/Book: 0.93||EV/EBITDA: 3.02|
|Market Cap: $91.32M||Avg. Daily Volume: 218,965||52 Week Range: $1.28 – $11.95|
You can view the full list of purchases from this Insider Buying page.
Notable Insider Sales:
1. The Ensign Group, Inc. (ENSG): $28.74
Director Roy E. Christensen sold 224,500 shares of this nursing and rehabilitative care provider for $29.37, generating $6.6 million from the sale. These shares were sold indirectly through a trust.
You can view the list of recent insider transactions for The Ensign Group, Inc. here.
|P/E: 13.88||Forward P/E: 11.59||Industry P/E: 21.05|
|P/S: 0.89||Price/Book: 2.5||EV/EBITDA: 7.01|
|Market Cap: $600.75M||Avg. Daily Volume: 135,257||52 Week Range: $16.35 – $34.85|
2. Acme Packet, Inc. (APKT): $65.70
Shares of this network equipment company were sold by 2 insiders:
- Chief Technology Officer Patrick J. Melampy sold 60,000 shares for $66.45, generating $3.9 million from the sale.
- VP Sales & Business Development Dino Dipalma sold 10,000 shares for $67.66, generating $676,571 from the sale. These shares were sold as a result of exercising options immediately prior to the sale.
You can view the list of recent insider transactions for Acme Packet, Inc. here.
|P/E: 95.36||Forward P/E: 43.51||Industry P/E: 16.67|
|P/S: 15.49||Price/Book: 10.91||EV/EBITDA: 43.68|
|Market Cap: $4.30B||Avg. Daily Volume: 2,437,120||52 Week Range: $26.00 – $84.50|
3. Apollo Group Inc. (APOL): $51.93
Shares of this for-profit education company were sold by 2 insiders:
- Executive Chairman of the Board John G. Sperling sold 82,235 shares for $49.24, generating $4.05 million from the sale. These shares were sold indirectly through a trust.
- Vice Chairman of the Board Peter V. Sperling sold 5,965 shares for $50.00, generating $298,250 from the sale.
You can view the list of recent insider transactions for Apollo Group Inc. here.
|P/E: 19.55||Forward P/E: 15.98||Industry P/E: 18.05|
|P/S: 1.46||Price/Book: 5.52||EV/EBITDA: 4.26|
|Market Cap: $7.35B||Avg. Daily Volume: 2,164,630||52 Week Range: $33.75 – $53.61|
4. Cobalt International Energy, Inc. (CIE): $14.78
Shares of this oil exploration company were sold by 4 insiders:
- General Counsel Samuel H. Gillespie sold 226,223 shares for $14.32, generating $3.2 million from the sale.
- Chief Exploration Officer James W. Farnsworth sold 30,300 shares for $14.59, generating $442,064 from the sale.
- EVP, Operations & Development Van P. Whitfield sold 6,600 shares for $14.51, generating $95,766 from the sale. 3,600 of these shares were sold indirectly through a trust.
- Vice President, Gov’t and Land Lynne L. Hackedorn sold 2,320 shares for $14.51, generating $33,663 from the sale.
You can view the list of recent insider transactions for Cobalt International Energy, Inc. here.
|P/E: N/A||Forward P/E: N/A||Industry P/E: 21.07|
|P/S: N/A||Price/Book: 3.02||EV/EBITDA: -38.06|
|Market Cap: $5.19B||Avg. Daily Volume: 943,214||52 Week Range: $7.14 – $17.22|
5. Booz Allen Hamilton Inc. (BAH): $18.94
Shares of this professional services company were sold by 3 insiders:
- EVP, Gen. Counsel & Secretary CG Appleby sold 209,685 shares for $18.65, generating $3.9 million from the sale.
- Executive Vice President Richard J. Wilhelm sold 50,045 shares for $18.89, generating $945,271 from the sale. These shares were sold as a result of exercising options immediately prior to the sale.
- Executive Vice President Gary D. Labovich sold 15,267 shares for $19.14, generating $292,213 from the sale. These shares were sold as a result of exercising options immediately prior to the sale.
You can view the list of recent insider transactions for Booz Allen Hamilton Inc. here.
|P/E: 25.59||Forward P/E: 10.89||Industry P/E: 22.98|
|P/S: 0.44||Price/Book: 2.7||EV/EBITDA: 8.14|
|Market Cap: $2.42B||Avg. Daily Volume: 318,629||52 Week Range: $17.39 – $20.73|
You can view the full list of sales from this Insider Sales page.