Insider Weekends – Alexander Otto Purchases $96 Million of Retail REIT DDR in Q2 2018

Welcome to edition 419 of Insider Weekends. Insider buying more than doubled last week with insiders purchasing $226.74 million of stock compared to $100.92 million in the week prior. Selling on the other hand decreased with insiders selling $1.43 billion of stock last week compared to $1.85 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 dropped to 6.3. 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 18.37.

Sector Heat Map of Management Insider Purchases June 29, 2018

Sector Heat Map of Management Insider Purchases June 29, 2018

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. DDR Corp. (DDR): $17.9

Director Alexander Otto acquired 1,761,741 shares of this shopping center REIT, paying $17.86 per share for a total amount of $31.46 million. Mr. Otto increased his stake by 5.83% to 31,990,657 shares with this purchase.

We reported last week that Mr. Otto’s $20.84 million purchase was his largest purchase in the span of a week since we started insider tracking data eight years ago. He topped that this week with his $31.46 million purchase, which brings his total purchases for the second quarter of 2018 to $95.96 million.

The spinoff of a division of the company called Retail Value Inc. (RVI) with all its Puerto Rico assets was supposed to occur on or before July 1st but I have not seen any news yet to that effect. We wrote the following about Mr. Otto last week,

Alexander Otto is the CEO of closely-held real estate management company ECE Projektmanagement. The company is based in Hamburg, Germany and manages about 200 shopping centers. He has been buying DDR stock actively since late February and following his latest purchases, owns about 16.37% of the company.

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

P/E: N/A Forward P/E: 47.11 Industry P/E: 33.16
P/S: 3.69 Price/Book: 1.47 EV/EBITDA: 12.94
Market Cap: $3.31B Avg. Daily Volume: 3,674,179 52 Week Range: $13.26 – $21.74

2. Aerpio Pharmaceuticals, Inc. (ARPO): $4.15

Director Muneer A. Satter acquired 1,818,182 shares of this biotech company, paying $3.85 per share for a total amount of $7 million. These shares were purchased indirectly through a trust.

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

P/E: N/A Forward P/E: -5.06098 Industry P/E: 85.7
P/S: N/A Price/Book: 10.0973 EV/EBITDA: -4.153
Market Cap: $112.66M Avg. Daily Volume: 40,217 52 Week Range: $3.29 – $6.75

3. Entercom Communications Corp. (ETM): $7.55

Chairman Emeritus Joseph M. Field acquired 370,000 shares of this radio broadcasting company, paying $7.79 per share for a total amount of $2.88 million. These shares were purchased indirectly through a trust.

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

P/E: 2.58 Forward P/E: 7.19 Industry P/E: 24.17
P/S: 1.34 Price/Book: 0.62 EV/EBITDA: 25.29
Market Cap: $1.07B Avg. Daily Volume: 2,243,989 52 Week Range: $6.3 – $12.43

4. OFG Bancorp (OFG): $14.05

Shares of this regional bank were acquired by 2 insiders:

  • Director Jorge Colon acquired 79,870 shares, paying $14.27 per share for a total amount of $1.14 million.
  • Director Nestor de Jesus  acquired 5,000 shares, paying $14.10 per share for a total amount of $70,500. Mr. de Jesus increased his stake by 50% to 15,000 shares with this purchase.

You can view the list of recent insider transactions for OFG Bancorp here.

P/E: 15.27 Forward P/E: 10.98 Industry P/E: 19.21
P/S: 2.27 Price/Book: 0.8 EV/EBITDA: N/A
Market Cap: $617.75M Avg. Daily Volume: 291,207 52 Week Range: $7.8 – $14.95

5. Green Brick Partners, Inc. (GRBK): $9.8

Shares of this home builder were acquired by 5 insiders:

  • Chief Executive Officer James R. Brickman acquired 25,000 shares, paying $9.49 per share for a total amount of $237,250.
  • Director Richard S. Press acquired 20,000 shares, paying $9.49 per share for a total amount of $189,899. Mr. Press increased his stake by 41.13% to 68,623 shares with this purchase.
  • Chief Financial Officer Richard Arthur Costello acquired 6,000 shares, paying $9.40 per share for a total amount of $56,400. Mr. Costello increased his stake by 16.89% to 41,514 shares with this purchase.
  • Chief Accounting Officer Summer Loveland acquired 5,300 shares, paying $9.47 per share for a total amount of $50,207.
  • President of Texas Region Jed Dolson acquired 4,600 shares, paying $9.45 per share for a total amount of $43,456. Mr. Dolson increased his stake by 5.09% to 94,981 shares with this purchase.

You can view the list of recent insider transactions for Green Brick Partners, Inc. here.

P/E: 24.94 Forward P/E: 7.26 Industry P/E: 12.1
P/S: 1.03 Price/Book: 1.16 EV/EBITDA: 9.17
Market Cap: $497.06M Avg. Daily Volume: 183,245 52 Week Range: $8.9 – $12.5

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

Notable Insider Sales:

1. Facebook, Inc. (FB): $194.32

Shares of Facebook were sold by 2 insiders:

  • COB and CEO Mark Zuckerberg sold 1,217,000 shares for $199.13, generating $242.34 million from the sale. These shares were sold indirectly by various entities.
  • VP and General Counsel Colin Stretch sold 750 shares for $199.18, generating $149,385 from the sale.

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

P/E: 32.17 Forward P/E: 21.03 Industry P/E: 34.28
P/S: 12.62 Price/Book: 7.27 EV/EBITDA: 21.07
Market Cap: $562.48B Avg. Daily Volume: 24,011,687 52 Week Range: $147.8 – $203.55

2. Twitter, Inc. (TWTR): $43.67

Shares of Twitter were sold by 2 insiders:

  • Director Evan Clark Williams sold 682,242 shares for $44.51, generating $30.36 million from the sale. These shares were sold indirectly by various trusts.
  • Chief Accounting Officer Robert Kaiden sold 5,159 shares for $44.44, generating $229,287 from the sale. These shares were sold indirectly by a trust.

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

P/E: 2183.5 Forward P/E: 51.38 Industry P/E: 34.28
P/S: 12.7927 Price/Book: 6.28165 EV/EBITDA: 68.212
Market Cap: $32.75B Avg. Daily Volume: 29,047,151 52 Week Range: $15.67 – $47.79

3. NVIDIA Corporation (NVDA): $236.9

Director Harvey C. Jones sold 100,000 shares of this semiconductor company for $242.11, generating $24.21 million from the sale.

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

P/E: 39.38 Forward P/E: 30.1 Industry P/E: 21.07
P/S: 13.09 Price/Book: 18.64 EV/EBITDA: 35.34
Market Cap: $143.8B Avg. Daily Volume: 12,456,918 52 Week Range: $138.58 – $269.2

4. American Eagle Outfitters, Inc. (AEO): $23.25

Exec Chairman & CEO Jay L. Schottenstein sold 842,206 shares of this apparel chain  for $25.42, generating $21.41 million from the sale. These shares were sold indirectly by various trust and entities.

You can view the list of recent insider transactions for American Eagle Outfitters, Inc. here.

P/E: 19.18 Forward P/E: 14.53 Industry P/E: 35.22
P/S: 1.06 Price/Book: 3.39 EV/EBITDA: 7.89
Market Cap: $4.11B Avg. Daily Volume: 4,336,875 52 Week Range: $10.23 – $25.78

5. Mimecast Limited (MIME): $41.21

Shares of this email and data security company were sold by 4 insiders:

  • Chief Technology Officer Neil Murray sold 213,465 shares for $41.45, generating $8.85 million from the sale.
  • Chief Executive Officer Peter Bauer sold 22,500 shares for $43.25, generating $973,025 from the sale.
  • Chief Operating Officer Edward Vincent Jennings sold 7,500 shares for $43.38, generating $325,323 from the sale.
  • Chief Financial Officer Peter Andrew Campbell sold 4,000 shares for $43.60, generating $174,407 from the sale.

You can view the list of recent insider transactions for Mimecast Limited here.

P/E: N/A Forward P/E: 82.42 Industry P/E: 34.28
P/S: 9.28 Price/Book: 23.89 EV/EBITDA: 182.78
Market Cap: $2.43B Avg. Daily Volume: 300,598 52 Week Range: $25.12 – $46.87

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

The list of all insider purchases and sales by management people is only available to InsideArbitrage Premium members.

Disclaimer: I hold a long position in Twitter (TWTR). 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.

Connect with me on LinkedIn: http://www.linkedin.com/in/asifsuria or follow me on Twitter @asifsuria

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