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Welcome to edition 180 of Insider Weekends. Insider buying declined sharply with insiders purchasing $9.99 million of their stock last week compared to $56.27 million in the week prior. Selling also declined with insiders selling $1.73 billion of stock last week compared to $2.82 billion in the week prior. The last time insider buying was so anemic was the week ending in April 27, 2012. That coincided with the peak of the first quarter earnings season and hence both insider buying and selling were muted.
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 increased to 173.3. In other words, insiders sold more than 173 times as much stock as they purchased. The Sell/Buy ratio this week compares unfavorably with the prior week, when the ratio stood at 40.57. 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, 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. Green Mountain Coffee Roasters, Inc. (GMCR): $67.38
Shares of this specialty coffee company were acquired by 3 insiders: