Insider Weekends – Insiders of Retail REITs Buy Again

Welcome to edition 361 of Insider Weekends. Insider buying more than doubled with insiders buying $293.62 million of stock compared to $143.26 million in the week prior. Selling declined with insiders selling $1.82 billion of stock last week compared to $2.11 billion 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 dropped to 6.18. In other words, insiders sold more than 6 times as much stock as they purchased. The Sell/Buy ratio this week compares favorably with the prior week, when the ratio stood at 14.7.

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:

There were several institutional purchases last week that were partially responsible for the spike in insider buying. Some of these institution purchases include Berkshire Hathaway’s Ted Weschler adding to their stake in Liberty Media (LSXMK), activist hedge fund Trian Partners increasing their stake in Pentair (PNR) and Bruce Berkowitz adding to his stake in Seritage Growth Properties (SRG) once again.

1. Antero Resources Corporation (AR): $22.24

Shares of this independent oil and natural gas company were acquired by 2 insiders:

• Chairman of the Board and Chief Executive Officer Paul M. Rady acquired 500,000 shares, paying $21.11 per share for a total amount of $10.56 million. Mr. Rady increased his stake by 4.68% to 11,172,368 shares with this purchase.
• Director, President, Chief Financial Officer and Secretary Glen C. Warren Jr. acquired 250,000 shares, paying $20.99 per share for a total amount of $5.25 million. Mr. Warren increased his stake by 2.43% to 10.54 million shares with this purchase.

You can view the list of recent insider transactions for Antero Resources Corporation here.

2. DDR Corp. (DDR): $9.33

Shares of this shopping center REIT were acquired by 2 insiders:

• 10% Owner Katharina Otto-Bernstein acquired 500,000 shares, paying $9.40 per share for a total amount of $4.7 million.
• President & CEO David R. Lukes acquired 170,000 shares, paying $9.48 per share for a total amount of $1.61 million. Mr. Lukes increased his stake by 83.77% to 372,948 shares with this purchase.
• EVP, CFO & Treasurer Matthew Louis Ostrower acquired 53,000 shares, paying $9.46 per share for a total amount of $501,380. Mr. Ostrower increased his stake by 96.30% to 108,036 shares with this purchase.

DDR’s stock has continued to decline since we reported on insider purchases by company insiders two weeks ago. We wrote the following in our May 7th update,

The 52 week low list had recently been dominated by retail REITs as they face two strong headwinds in the form of rising interest rates and the shutting down of a record number of physical retail stores. I have been watching this group of about 25 companies with a lot of interest and insider purchases within the group may be one indicator of whether it is time to start fishing in this pond. Significant insider sales despite a decline in the stock as we saw in the case of the retail REIT Regency Centers Corporation (REG) in early March give me pause.

You can view the list of recent insider transactions for DDR Corp. here.

3. Revlon, Inc. (REV): $19.25

Director Ronald O. Perelman acquired 325,000 shares of this beauty care products company, paying $19.57 per share for a total amount of $6.36 million. These shares were purchased indirectly by MacAndrews & Forbes Incorporated.

We wrote the following about Mr. Perelman’s purchase of Revlon last week,

Following this purchase Mr. Perelman’s holding company MacAndrews & Forbes Incorporated owns nearly 80% of Revlon. The holding company acquired Revlon for $1.8 billion and incurred other acquisition related costs of $900 million in 1985. Revlon once again became a publicly traded company in 1996. The stock dropped sharply earlier this month after Revlon reported disappointing first quarter results with sales declining 5.8% and a net loss of $6.6 million (adjusting for Revlon’s acquisition of Elizabeth Arden).

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

4. American Assets Trust, Inc. (AAT): $39.36

Chairman, CEO & President Ernest S. Rady acquired 133,172 shares of this diversified REIT, paying $39.03 per share for a total amount of $5.19 million. These shares were purchased indirectly by American Assets, Inc.

While American Assets Trust is a diversified REIT with retail space, office space, apartments and a hotel, a majority of the company’s square footage is dedicated to retail and hence I would classify it as a retail REIT instead of a diversified REIT.

You can view the list of recent insider transactions for American Assets Trust, Inc. here.

5. American International Group, Inc. (AIG): $61.2

President & CEO Brian Duperreault acquired 80,000 shares of this insurance company, paying $61.48 per share for a total amount of $4.92 million.

You can view the list of recent insider transactions for American International Group, Inc. here.

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

Notable Insider Sales:

1. Facebook, Inc. (FB): $148.06

Shares of Facebook were sold by 5 insiders:

• Director Jan Koum sold 594,246 shares for $149.73, generating $88.97 million from the sale. These shares were sold indirectly through a trust.
• COB and CEO Mark Zuckerberg sold 286,387 shares for $148.40, generating $42.49 million from the sale.
• Chief Operating Officer Sheryl Sandberg sold 163,500 shares for $149.93, generating $24.51 million from the sale. These shares were sold indirectly through a trust.
• VP and General Counsel Colin Stretch sold 750 shares for $150.10, generating $112,575 from the sale. These shares were sold as a result of exercising options immediately prior to the sale.
• Director Susan Desmond-Hellmann sold 209 shares for $144.67, generating $30,236 from the sale. These shares were sold indirectly through a trust.

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

2. Arista Networks, Inc. (ANET): $144.07

Shares of this networking solutions provider were sold by 2 insiders:

• President and CEO Jayshree Ullal sold 115,961 shares for $147.29, generating $17.08 million from the sale. These shares were sold indirectly through various trusts.
• Director Marc F. Stoll sold 16,000 shares for $145.03, generating $2.32 million from the sale.

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

3. CBOE Holdings, Inc. (CBOE): $85.04

Shares of this options exchange operator were sold by 2 insiders:

• Director Joseph P. Ratterman sold 175,955 shares for $84.06, generating $14.79 million from the sale. These shares were sold indirectly through a trust.
• Director Frank E. English Jr. sold 400 shares for $84.33, generating $33,732 from the sale.

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

4. SBA Communications Corporation (SBAC): $132.8

Shares of this operator of wireless communications towers were sold by 2 insiders:

• Chief Executive Officer & Pres Jeffrey Stoops sold 94,289 shares for $133.76, generating $12.61 million from the sale.
• Director Brian C. Carr sold 3,475 shares for $132.54, generating $460,576 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 SBA Communications Corporation here.

5. Twitter, Inc. (TWTR): $18.35

Director Evan Clark Williams sold 684,900 shares of Twitter for $18.58, generating $12.72 million from the sale. These shares were sold indirectly through various trusts.

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

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

Disclaimer: I hold a long position in Twitter. Please do your own due diligence before buying or selling any securities mentioned in this article. We do not warrant the completeness or accuracy of the content or data provided in this article.

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