Insider Weekends – October 9, 2015

  • October 10, 2015

Welcome to edition 277 of Insider Weekends. Insider buying dropped significantly last week with insiders buying $55.32 million of stock compared to $226.99 million in the week prior. Selling also declined with insiders selling $489.91 million of stock last week compared to $594.85 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 8.85. In other words, insiders sold almost 9 times as much stock as they purchased. The Sell/Buy ratio this week compares unfavorably with the prior week, when the ratio stood at 2.62. 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.

Insider Sell Buy Ratio October 9, 2015
Insider Sell Buy Ratio October 9, 2015

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. New York REIT, Inc. (NYRT): $10.84

Director Marc J. Rowan acquired 234,948 shares of this commercial REIT, paying $10.61 per share for a total amount of $2.49 million. These shares were purchased indirectly through MJR Funding LLC.

Mr. Rowan is a co-founder and Senior Managing Director of the private equity firm Apollo Global Management (APO).

You can view the list of recent insider transactions for New York REIT, Inc. here.

P/E: N/AForward P/E: 23.57Industry P/E: N/A
P/S: 9.95Price/Book: 1.58EV/EBITDA: 44.22
Market Cap: $1.76BAvg. Daily Volume: 1,101,99052 Week Range: $8.87 – $11.41

2. Conns Inc. (CONN): $24.48

Shares of this specialty retailer of home appliances were acquired by 2 insiders:

  • President and CEO Norman Miller acquired 20,333 shares, paying $24.89 per share for a total amount of $506,088. Mr. Miller increased his stake by 29.10% to 90,214 shares with this purchase.
  • Director Douglas H. Martin acquired 12,000 shares, paying $24.25 per share for a total amount of $291,000. These shares were purchased indirectly through a Roth IRA.

You can view the list of recent insider transactions for Conns Inc. here.

P/E: 20.23Forward P/E: 9.1Industry P/E: N/A
P/S: 0.59Price/Book: 1.32EV/EBITDA: 17.66
Market Cap: $893.91MAvg. Daily Volume: 786,01752 Week Range: $14.02 – $43.95

3. Box, Inc. (BOX): $12.22

Shares of this cloud-based enterprise content collaboration company were acquired by 2 insiders:

  • Chief Executive Officer Aaron Levie acquired 50,000 shares, paying $11.88 per share for a total amount of $594,140.
  • Director Josh Stein acquired 10,000 shares, paying $11.75 per share for a total amount of $117,545. These shares were purchased indirectly through a trust.

You can view the list of recent insider transactions for Box, Inc. here.

Voluntary Disclosure: I hold a long position in Box.

P/E: N/AForward P/E: N/AIndustry P/E: 33.95
P/S: 5.54Price/Book: 7.2EV/EBITDA: -7.48
Market Cap: $1.47BAvg. Daily Volume: 1,071,13052 Week Range: $10.93 – $24.73

4. Yum! Brands, Inc. (YUM): $70.25

Executive Chairman David C. Novak acquired 8,170 shares of this restaurant chain, paying $77.97 per share for a total amount of $637,053. Mr. Novak increased his stake by 2.76% to 303,834 shares with this purchase.

Yum saw its shares drop 18.8% earlier this week before making back some of those losses on Friday. Investors decided to ignore a 12% increase in the quarterly dividend, a 23% increase in operating profits and a 2% increase in same-store sales across their network of brands, which includes Taco Bell, KFC and Pizza Hut.

The Taco Bell division firing on all cylinders with a 4% increase in same-store sales also did not matter much. Neither did the fact that the company opened 376 new restaurants with a majority of them in emerging markets. The primary focus was a big miss on expectations of same-store sales in China, which increased 2% instead of the 9.6% increase analysts were looking for. Earnings of $1 per share also missed expectations of earnings of $1.07 per share.

You can view the list of recent insider transactions for Yum! Brands, Inc. here.

P/E: 34.42Forward P/E: 18.88Industry P/E: 22.17
P/S: 2.22Price/Book: 18.57EV/EBITDA: 14.31
Market Cap: $30.29BAvg. Daily Volume: 4,963,79052 Week Range: $65.81 – $95.9

5. FS Investment Corporation (FSIC): $9.73

Shares of this business development company were acquired by 2 insiders:

  • Chief Executive Officer Michael C. Forman acquired 39,386 shares, paying $9.65 per share for a total amount of $380,089. Mr. Forman increased his stake by 8.79% to 487,216 shares with this purchase. These shares were purchased indirectly through Franklin Square Holdings, L.P.
  • President Gerald Stahlecker acquired 4,000 shares, paying $9.67 per share for a total amount of $38,670. Mr. Stahlecker increased his stake by 63.15% to 10,334 shares with this purchase.

You can view the list of recent insider transactions for FS Investment Corporation here.

P/E: 13.98Forward P/E: 10.03Industry P/E: N/A
P/S: 4.88Price/Book: 0.99EV/EBITDA: N/A
Market Cap: $2.36BAvg. Daily Volume: 809,39452 Week Range: $6.91 – $10.7

You can view the full list of purchases from this Insider Buying page.

Notable Insider Sales:

1. G-III Apparel Group, Ltd. (GIII): $64.93

Shares of this apparel chain were sold by 6 insiders:

  • CEO and President Morris Goldfarb sold 137,631 shares for $64.71, generating $8.91 million from the sale.
  • Vice Chairman Sammy Aaron sold 35,841 shares for $64.05, generating $2.29 million from the sale.
  • Chief Operating Officer Wayne S. Miller sold 35,000 shares for $64.75, generating $2.27 million from the sale.
  • Director Jeffrey David Goldfarb sold 12,683 shares for $64.05, generating $812,391 from the sale.
  • Chief Financial Officer/Treas Neal Nackman sold 9,000 shares for $64.94, generating $584,459 from the sale.
  • Director Katz Jeanette Nostra sold 935 shares for $64.05, generating $59,886 from the sale.

You can view the list of recent insider transactions for G-III Apparel Group, Ltd. here.

P/E: 24.57Forward P/E: 19.21Industry P/E: 14.29
P/S: 1.32Price/Book: 3.76EV/EBITDA: 14.43
Market Cap: $2.92BAvg. Daily Volume: 356,40052 Week Range: $35.34 – $73.93

2. Apollo Global Management, LLC (APO): $18.62

Senior Managing Director Marc J. Rowan sold 729,968 shares of this investment manager for $18.19, generating $13.28 million from the sale. These shares were sold indirectly by MJR Foundation .

You can view the list of recent insider transactions for Apollo Global Management, LLC here.

P/E: 46.43Forward P/E: 9Industry P/E: 8.69
P/S: 2.9Price/Book: 4.34EV/EBITDA: N/A
Market Cap: $3.25BAvg. Daily Volume: 1,017,21052 Week Range: $15.35 – $25.8

3. ServiceNow, Inc. (NOW): $74.42

Shares of this software-as-a-service provider were sold by 3 insiders:

  • Chief Product Officer Frederic B. Luddy sold 203,600 shares for $73.56, generating $14.98 million from the sale. These shares were sold indirectly through a trust.
  • President & CEO Frank Slootman sold 125,000 shares for $69.40, generating $8.67 million from the sale. These shares were sold as a result of exercising options immediately prior to the sale.
  • Chief Revenue Officer David Schneider sold 10,000 shares for $74.63, generating $746,253 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 ServiceNow, Inc. here.

P/E: N/AForward P/E: 158.34Industry P/E: 17.97
P/S: 13.64Price/Book: 24.5EV/EBITDA: -93.86
Market Cap: $11.62BAvg. Daily Volume: 1,301,52052 Week Range: $54.05 – $83.52

4. Euronet Worldwide, Inc. (EEFT): $77.28

CEO and President of EWI Inc. Michael J. Brown sold 100,000 shares of this business services company for $75.06, generating $7.51 million from the sale.

You can view the list of recent insider transactions for Euronet Worldwide, Inc. here.

P/E: 42.02Forward P/E: 20.66Industry P/E: 17.87
P/S: 2.33Price/Book: 5.39EV/EBITDA: 15.59
Market Cap: $4.07BAvg. Daily Volume: 297,37152 Week Range: $43.92 – $77.5

5. ePlus inc. (PLUS): $86.55

Shares of this IT solutions provider were sold by 3 insiders:

  • President and CEO Phillip G. Norton sold 57,750 shares for $82.05, generating $4.74 million from the sale. These shares were sold indirectly by J.A.P. Investment Group, L.P.
  • Director Bruce M. Bowen sold 20,000 shares for $84.57, generating $1.69 million from the sale. These shares were sold indirectly by Bowen Holdings LLC.
  • Director Lawrence S. Herman sold 1,000 shares for $80.00, generating $80,000 from the sale.

You can view the list of recent insider transactions for ePlus inc. here.

P/E: 14.04Forward P/E: 12.98Industry P/E: 33.95
P/S: 0.56Price/Book: 2.22EV/EBITDA: 8.29
Market Cap: $647.08MAvg. Daily Volume: 102,64052 Week Range: $54.05 – $91.38

You can view the full list of sales from this Insider Sales page.

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