Welcome to edition 398 of Insider Weekends. Insider buying almost doubled last week with insiders purchasing $47.89 million of stock compared to $24.96 million in the week prior. Selling also increased with insiders selling $1.03 billion of stock last week compared to $916.91 million in the week prior.
In our last post we discussed that the S&P 500 had gained 7.45% in the span of the first four weeks of 2018 after gaining over 21% in 2017. The market gave back some of those gains last week with the S&P 500 retreating 3.85% for the week along with a global sell off in equities. The 666 point drop in the Dow on Friday was reminiscent of the big drops we saw in late 2008 and early 2009 but with some differences. In percentage terms, this drop was much smaller and the financial sector and the economy are not in the kind of situation we were in in late 2018. We could be at the cusp of a healthy pull back and I have personally increased my hedges and plan to rebalance my portfolio by reducing my equity exposure.
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 21.48. In other words, insiders sold more than 21 times as much stock as they purchased. The Sell/Buy ratio this week compares favorably with the prior week, when the ratio stood at 36.73.
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. Revolution Lighting Technologies, Inc. (RVLT): $4.37
Shares of this LED lighting solutions manufacturer were acquired by 2 insiders:
- Chairman and CEO Robert V. LaPenta acquired 875,000 shares, paying $3.61 per share for a total amount of $3.16 million. Mr. LaPenta increased his stake by 1166.67% to 950,000 shares with this purchase.
- Chief Financial Officer James DePalma acquired 150,000 shares, paying $3.60 per share for a total amount of $540,000. Mr. DePalma increased his stake by 333.33% to 195,000 shares with this purchase.
Investors reacted with enthusiasm to these insider purchases and the stock appreciated over 20% last week, including a 4.3% gain on Friday when most of the market was down. While sales have been increasing in each of the last three years, the company guided Q4 sales down from its previous estimate because of the impact of the hurricanes in Texas. The company also indicated that it will be free cash flow positive in Q4, which is a departure from the negative free cash flow the company has seen in each of the last four quarters.
You can view the list of recent insider transactions for Revolution Lighting Technologies, Inc. here.
|P/E: N/A||Forward P/E: -12.49||Industry P/E: 14.11|
|P/S: 0.58||Price/Book: 0.77||EV/EBITDA: 17.5|
|Market Cap: $97.09M||Avg. Daily Volume: 294,945||52 Week Range: $2.95 – $9.17|
2. Biglari Holdings Inc. (BH): $404
Director Sardar Biglari, acquired 5,589 shares of this holding company, paying $416.00 per share for a total amount of $2.33 million. 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: 9.61||Forward P/E: -87.26||Industry P/E: 62.45|
|P/S: 1||Price/Book: 1.63||EV/EBITDA: 32.86|
|Market Cap: $835.31M||Avg. Daily Volume: 7,032||52 Week Range: $290.05 – $451.15|
3. Opko Health, Inc. (OPK): $4.25
CEO & Chairman Phillip Frost M.D. acquired 120,000 shares of this medical devices and drug development company, paying $4.67 per share for a total amount of $560,128. These shares were purchased indirectly by Frost Nevada Investments Trust.
You can view the list of recent insider transactions for Opko Health, Inc. here.
|P/E: N/A||Forward P/E: -26.56||Industry P/E: 33.89|
|P/S: 2.07||Price/Book: 1.14||EV/EBITDA: -36.39|
|Market Cap: $2.38B||Avg. Daily Volume: 4,764,872||52 Week Range: $4.25 – $8.92|
4. Range Resources Corporation (RRC): $13.55
Director Steffen E. Palko acquired 34,000 shares of this independent natural gas company, paying $14.72 per share for a total amount of $500,609. Mr. Palko increased his stake by 124.69% to 61,267 shares with this purchase.
You can view the list of recent insider transactions for Range Resources Corporation here.
|P/E: N/A||Forward P/E: 16.73||Industry P/E: 26.16|
|P/S: 1.47||Price/Book: 0.6||EV/EBITDA: 8.41|
|Market Cap: $3.31B||Avg. Daily Volume: 8,186,550||52 Week Range: $13.26 – $34.93|
5. IHS Markit Ltd. (INFO): $47.02
Director Robert P. Kelly acquired 10,000 shares of this business analytics company, paying $48.69 per share for a total amount of $486,900. Mr. Kelly increased his stake by 13.24% to 85,525 shares with this purchase.
You can view the list of recent insider transactions for IHS Markit Ltd. here.
|P/E: 47.02||Forward P/E: 18.3||Industry P/E: 29.01|
|P/S: 5.16||Price/Book: 2.34||EV/EBITDA: 20.6|
|Market Cap: $18.56B||Avg. Daily Volume: 1,997,400||52 Week Range: $37.82 – $49.19|
You can view the full list of purchases from this Insider Buying page.
Notable Insider Sales:
1. Adobe Systems Incorporated (ADBE): $195.64
Shares of this software company were sold by 3 insiders:
- EVP WW Field Operations Matthew Thompson sold 50,775 shares for $200.08, generating $10.16 million from the sale. These shares were sold indirectly through a trust.
- EVP & GM, Digital Media Bryan Lamkin sold 30,000 shares for $199.08, generating $5.97 million from the sale.
- EVP, Gen. Counsel & Secretary Michael A. Dillon sold 6,376 shares for $197.13, generating $1.26 million from the sale.
You can view the list of recent insider transactions for Adobe Systems Incorporated here.
|P/E: 57.88||Forward P/E: 27.55||Industry P/E: 41.68|
|P/S: 13.17||Price/Book: 11.36||EV/EBITDA: 36.98|
|Market Cap: $96.17B||Avg. Daily Volume: 2,646,208||52 Week Range: $113.29 – $204.45|
2.The Charles Schwab Corporation (SCHW): $53.34
Chairman Charles R. Schwab sold 240,000 shares of this investment brokerage for $54.03, generating $12.97 million from the sale. These shares were sold indirectly by a trust.
You can view the list of recent insider transactions for here.
|P/E: 33.13||Forward P/E: 18.72||Industry P/E: 18.63|
|P/S: 8.30||Price/Book: 4.69||EV/EBITDA: N/A|
|Market Cap: $71.51B||Avg. Daily Volume: 6,416,654||52 Week Range: $37.16 – $56.25|
3. The Goldman Sachs Group, Inc. (GS): $260.04
Shares of Goldman Sachs were sold by 3 insiders:
- President and Co-COO David M. Solomon sold 21,252 shares for $271.65, generating $5.77 million from the sale.
- Executive Vice President – CFO Martin R. Chavez sold 11,829 shares for $268.43, generating $3.18 million from the sale. 1,540 of these shares were sold indirectly through a trust.
- Vice Chairman Pablo J. Salame sold 10,000 shares for $270.42, generating $2.7 million from the sale.
You can view the list of recent insider transactions for The Goldman Sachs Group, Inc. here.
|P/E: 28.87||Forward P/E: 10.83||Industry P/E: 18.63|
|P/S: 3.06||Price/Book: 1.45||EV/EBITDA: N/A|
|Market Cap: $98.09B||Avg. Daily Volume: 3,120,822||52 Week Range: $209.62 – $273.79|
4. United Rentals, Inc. (URI): $173.3
Shares of this equipment rental company were sold by 5 insiders:
- President and CEO Michael Kneeland sold 30,000 shares for $182.75, generating $5.48 million from the sale.
- EVP, Business Services & CIO Dale A. Asplund sold 11,439 shares for $185.13, generating $2.12 million from the sale.
- EVP, Chief Admin. & Legal Off. Craig Adam Pintoff sold 8,743 shares for $185.14, generating $1.62 million from the sale.
- SVP, Controller Jessica Graziano sold 3,405 shares for $185.00, generating $629,925 from the sale.
- Director Jenne K. Britell sold 2,740 shares for $185.50, generating $508,261 from the sale.
You can view the list of recent insider transactions for United Rentals, Inc. here.
|P/E: 11.02||Forward P/E: 10.84||Industry P/E: 33.76|
|P/S: 2.2||Price/Book: 4.71||EV/EBITDA: 12.18|
|Market Cap: $14.63B||Avg. Daily Volume: 1,168,696||52 Week Range: $100.62 – $189|
5. Total System Services, Inc. (TSS): $86.83
Shares of this electronic payment processing services provider were sold by 6 insiders:
- Chairman and CEO Troy M. Woods sold 49,540 shares for $87.81, generating $4.35 million from the sale.
- Sr. EVP, Gen. Counsel, Sec. Sanders G. Griffith sold 13,146 shares for $87.81, generating $1.15 million from the sale.
- Sr. EVP and CFO Paul M. Todd sold 11,900 shares for $87.81, generating $1.04 million from the sale.
- Senior EVP and CIO Patricia A. Watson sold 9,596 shares for $88.42, generating $848,469 from the sale.
- Director Richard W. Ussery sold 7,546 shares for $88.29, generating $666,259 from the sale. These shares were sold as a result of exercising options immediately prior to the sale.
- EVP & Chief Accounting Officer Dorenda K. Weaver sold 2,686 shares for $87.81, generating $235,868 from the sale.
You can view the list of recent insider transactions for Total System Services, Inc. here.
|P/E: 27.48||Forward P/E: 18.4||Industry P/E: 104.71|
|P/S: 3.24||Price/Book: 6.77||EV/EBITDA: 16.45|
|Market Cap: $15.96B||Avg. Daily Volume: 1,275,309||52 Week Range: $50.96 – $89.92|
You can view the full list of sales from this Insider Sales page.
Disclaimer: 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.