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Welcome to edition 263 of Insider Weekends. Insider buying almost tripled last week with insiders buying $140.28 million of stock compared to $57.81 million in the week prior. Selling on the other hand declined with insiders selling $355.34 million of stock last week compared to $870.92 million in the week prior.
A majority of the insider purchases this week were related to David Einhorn participating into a secondary offering by home builder Green Brick Partners (GRBK) to the tune of nearly $85 million. Mr. Einhorn, Greenlight Capital and various other related entities now hold 24.13 million shares of Green Brick Partners. Insider selling was muted, as expected, on account of the start of earnings season.
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 2.53. In other words, insiders sold almost 3 times as much stock as they purchased. The Sell/Buy ratio this week compares favorably with the prior week, when the ratio stood at 15.07. 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.