Welcome to edition 381 of Insider Weekends. Insider buying decreased last week with insiders purchasing $26.99 million of stock compared to $47.6 million in the week prior. Since we are in the quiet period before earnings season begins, insider activity is muted and is likely to remain so for the next two or three weeks. Selling increased with insiders selling $952.23 million of stock last week compared to $772.2 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 35.28. In other words, insiders sold more than 35 times as much stock as they purchased. The Sell/Buy ratio this week compares unfavorably with the prior week, when the ratio stood at 16.22.
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. L Brands, Inc. (LB): $42.92
Director David T. Kollat acquired 26,500 shares of this apparel chain, paying $37.56 per share for a total amount of $995,340. Mr. Kollat increased his stake by 21.64% to 148,968 shares with this purchase.
L Brands, the company that owns brands like Victoria’s Secret and Bath & Body Works, also made our list last week when a director picked up 20,000 shares. Mr. Kollat was the President of Victoria’s Secret Catalogue from 1976 to 1987 and has served on the board of directors for over 40 years. Ironically Victoria’s Secret decided to discontinue its print catalog last year to save about $125 million to $150 million in expenses. The company also decided to discontinue its line of swimwear, clothing and accessories last year and this has been hurting sales comparisons this year in a generally weak retail environment for brick and mortar retailers.
On the positive side, the company has multiple strong brands, appears to be cheap at an EV/EBITDA of 7 and sports an attractive dividend yield of 5.6%. On the other hand, revenue has been declining the last two quarters, soft mall traffic is hurting mall-based retailers and the company is leveraged with nearly $4.4 billion in net debt on the balance sheet.
Earlier this year when both L Brands and Ralph Lauren (RL) were close to 52 week lows, I ran this poll on Twitter about the prospects of both companies over the next 2 to 3 years. L Brands emerged the winner with 44% of the votes. In the short-term financial Twitter turned out to be right as in the ensuing weeks, L Brands rallied 29% while Ralph Lauren dropped nearly 17% to a fresh 52 week low. However things reversed course and as of last Friday, Ralph Lauren has outperformed L Brands by nearly 20%. I fully understand that given the number of total votes, this was nothing more than anecdotal information and not statistically significant.
You can view the list of recent insider transactions for L Brands, Inc. here.
|P/E: 12.6||Forward P/E: 13.05||Industry P/E: 12.51|
|P/S: 0.99||Price/Book: N/A||EV/EBITDA: 6.94|
|Market Cap: $12.18B||Avg. Daily Volume: 4,584,118||52 Week Range: $35 – $75.5|
2. Shoe Carnival, Inc. (SCVL): $22.2
Director Charles B. Tomm acquired 11,190 shares of this footwear retailer, paying $22.69 per share for a total amount of $253,868. Mr. Tomm increased his stake by 194.34% to 16,948 shares with this purchase.
Mr. Tomm was appointed to the board of directors last month. Since new directors often purchase shares, I wouldn’t read much into his purchase.
You can view the list of recent insider transactions for Shoe Carnival, Inc. here.
|P/E: 18.88||Forward P/E: 13.96||Industry P/E: 12.51|
|P/S: 0.38||Price/Book: 1.27||EV/EBITDA: 5.57|
|Market Cap: $377.84M||Avg. Daily Volume: 234,117||52 Week Range: $15.08 – $31.79|
3. Ambac Financial Group, Inc. (AMBC): $16.92
Chief Executive Officer Claude LeBlanc acquired 15,000 shares of this insurance company, paying $16.64 per share for a total amount of $249,570. Mr. LeBlanc increased his stake by 46.15% to 47,500 shares with this purchase.
You can view the list of recent insider transactions for Ambac Financial Group, Inc. here.
|P/E: -6.87||Forward P/E: 4.06||Industry P/E: 12.51|
|P/S: 1.32||Price/Book: 0.46||EV/EBITDA: 131.15|
|Market Cap: $765.65M||Avg. Daily Volume: 304,823||52 Week Range: $15.67 – $27.25|
4. Hornbeck Offshore Services, Inc. (HOS): $4.03
Shares of this transportation services provider to the oil drilling industry were acquired by 7 insiders:
- Director Kevin Omar Meyers acquired 5,859 shares, paying $3.96 per share for a total amount of $23,202. Mr. Meyers increased his stake by 10.11% to 63,803 shares with this purchase.
- Director Bruce W. Hunt acquired 5,859 shares, paying $3.96 per share for a total amount of $23,202. Mr. Hunt increased his stake by 4.33% to 141,163 shares with this purchase.
- Director Larry D. Hornbeck acquired 4,557 shares, paying $3.96 per share for a total amount of $18,046. Mr. Hornbeck increased his stake by 1.74% to 266,613 shares with this purchase.
- Director Patricia B. Melcher acquired 4,557 shares, paying $3.96 per share for a total amount of $18,046. Ms. Melcher increased her stake by 5.06% to 94,578 shares with this purchase.
- Director Bernie W. Stewart acquired 4,101 shares, paying $3.96 per share for a total amount of $16,240. Mr. Stewart increased his stake by 4.38% to 97,705 shares with this purchase.
- Director John T. Rynd acquired 4,036 shares, paying $3.96 per share for a total amount of $15,983. Mr. Rynd increased his stake by 6.73% to 63,980 shares with this purchase.
- Director Nicholas Lew Swyka acquired 3,906 shares, paying $3.96 per share for a total amount of $15,468. Mr. Swyka increased his stake by 7.04% to 59,399 shares with this purchase.
You can view the list of recent insider transactions for Hornbeck Offshore Services, Inc. here.
|P/E: -1.77||Forward P/E: -1.37||Industry P/E: 12.51|
|P/S: 0.85||Price/Book: 0.11||EV/EBITDA: 78.91|
|Market Cap: $149.22M||Avg. Daily Volume: 620,659||52 Week Range: $1.51 – $9.07|
5. Biglari Holdings Inc. (BH): $347.99
Director Sardar Biglari, acquired 211 shares of this holding company, paying $333.84 per share for a total amount of $70,440. These shares were purchased indirectly by The Lion Fund.
You can view the list of recent insider transactions for Biglari Holdings Inc. here.
|P/E: 26.46||Forward P/E: -451.94||Industry P/E: 12.51|
|P/S: 0.86||Price/Book: 1.34||EV/EBITDA: 20.18|
|Market Cap: $719.51M||Avg. Daily Volume: 6,831||52 Week Range: $290.05 – $491.74|
You can view the full list of purchases from this Insider Buying page.
Notable Insider Sales:
1. Facebook, Inc. (FB): $172.23
Shares of Facebook were sold by 2 insiders:
- COB and CEO Mark Zuckerberg sold 249,527 shares for $170.32, generating $42.49 million from the sale. These shares were sold indirectly through various entities.
- VP and General Counsel Colin Stretch sold 750 shares for $170.10, generating $127,573 from the sale.
You can view the list of recent insider transactions for Facebook, Inc. here.
|P/E: 38.55||Forward P/E: 26.62||Industry P/E: 12.51|
|P/S: 15.08||Price/Book: 7.51||EV/EBITDA: 25.43|
|Market Cap: $500.19B||Avg. Daily Volume: 16,134,029||52 Week Range: $113.55 – $175.49|
2. Vail Resorts, Inc. (MTN): $217.65
Chief Exec.Officer & Chairman Robert A. Katz sold 115,900 shares of this mountain resorts operator for $218.73, generating $25.35 million from the sale.
You can view the list of recent insider transactions for Vail Resorts, Inc. here.
|P/E: 42.36||Forward P/E: 36.83||Industry P/E: 12.51|
|P/S: 4.57||Price/Book: 5.53||EV/EBITDA: 17.47|
|Market Cap: $8.72B||Avg. Daily Volume: 266,253||52 Week Range: $151.6 – $232.71|
3. Apple Inc. (AAPL): $155.3
Shares of Apple were sold by 2 insiders:
- Senior Vice President Angela J. Ahrendts sold 63,388 shares for $154.21, generating $9.78 million from the sale.
- Senior Vice President Philip W. Schiller sold 56,808 shares for $154.70, generating $8.79 million from the sale. These shares were sold indirectly through a trust.
You can view the list of recent insider transactions for Apple Inc. here.
|P/E: 17.63||Forward P/E: 14.27||Industry P/E: 12.51|
|P/S: 3.59||Price/Book: 6.06||EV/EBITDA: 11.79|
|Market Cap: $802.16B||Avg. Daily Volume: 27,766,221||52 Week Range: $104.08 – $164.94|
4. Copart, Inc. (CPRT): $35.24
Shares of this online auctions and vehicle remarketing company were sold by 2 insiders:
- President Vincent W. Mitz sold 200,000 shares for $34.32, generating $6.86 million from the sale.
- Director James E. Meeks sold 160,000 shares for $34.33, generating $5.49 million 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 Copart, Inc. here.
|P/E: 20.33||Forward P/E: 24.99||Industry P/E: 12.51|
|P/S: 5.62||Price/Book: 8.07||EV/EBITDA: 15.52|
|Market Cap: $8.13B||Avg. Daily Volume: 1,145,928||52 Week Range: $25.37 – $35.29|
5. QVC Group (QVCA): $23.08
Director Mark C. Vadon sold 475,153 shares of this online and television-based commerce company for $23.46, generating $11.15 million from the sale.
You can view the list of recent insider transactions for QVC Group here.
|P/E: 23.97||Forward P/E: 16.14||Industry P/E: 12.51|
|P/S: 1.03||Price/Book: 2.08||EV/EBITDA: 9.15|
|Market Cap: $10.43B||Avg. Daily Volume: 3,635,076||52 Week Range: $17.24 – $26|
You can view the full list of sales from this Insider Sales page.
Disclaimer: I hold a long position in L Brands (LB). 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.