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Happy New Year and welcome to edition 446 of Insider Weekends. The post-Christmas rally continued on Wall Street with the S&P 500 up 1.86% last week following a 2.86% gain in the prior week. Investors was cheered on last Friday from comments by Fed Chair Powell that indicated they might be patient with their rate hikes following recent tame inflation readings. Obviously several factors can put an end to this nascent rally in the coming weeks including a government shutdown that drags on longer than investors were expecting, further weakening in the housing market, the fed raising rates again and the slowdown in China accelerating. Insider buying was muted last week but that is probably more on account of the quite period before earnings than the rise in the markets over the last two weeks.
Insider buying declined last week with insiders purchasing $29.77 million million of stock compared to $57.27 million in the week prior. Selling on the other hand increased with insiders selling $349.6 million of stock last week compared to $246.43 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 11.75. In other words, insiders sold almost 12 times as much stock as they purchased. The Sell/Buy ratio this week compares unfavorably with the prior week, when the ratio stood at 4.3.
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. Scientific Games Corporation (SGMS): $19.21
Director Ronald O. Perelman acquired 400,000 shares of this gaming company, paying $17.11 per share for a total amount of $6.84 million. These shares were purchased indirectly by MacAndrews & Forbes Incorporated.
This follows a $4.95 million purchase last week when we wrote about a trio of insider purchases by Mr. Perelman.
You can view the list of recent insider transactions for Scientific Games Corporation here.
| P/E: N/A | Forward P/E: 36.94 | Industry P/E: 44.95 |
| P/S: 0.53 | Price/Book: N/A | EV/EBITDA: 9.92 |
| Market Cap: $1.76B | Avg. Daily Volume: 1,990,738 | 52 Week Range: $14.79 – $62.8 |
2. Prospect Capital Corporation (PSEC): $6.4
Chief Executive Officer John F. Barry acquired 299,707 shares of this business development company, paying $6.31 per share for a total amount of $1.89 million. Mr. Barry increased his stake by 0.80% to 37,892,777 shares with this purchase.
You can view the list of recent insider transactions for Prospect Capital Corporation here.
| P/E: 7.71 | Forward P/E: 7.19 | Industry P/E: 10.45 |
| P/S: 3.56 | Price/Book: 0.68 | EV/EBITDA: N/A |
| Market Cap: $2.34B | Avg. Daily Volume: 2,445,350 | 52 Week Range: $5.7 – $7.6 |
3. Revlon, Inc. (REV): $26.93
Director Ronald O. Perelman acquired 65,000 shares of this beauty care products company, paying $24.58 per share for a total amount of $1.59 million. These shares were purchased indirectly by MacAndrews & Forbes Incorporated.
You can view the list of recent insider transactions for Revlon, Inc. here.
| P/E: N/A | Forward P/E: -21.89 | Industry P/E: 79.57 |
| P/S: 0.55 | Price/Book: N/A | EV/EBITDA: 43.07 |
| Market Cap: $1.42B | Avg. Daily Volume: 231,052 | 52 Week Range: $14 – $29.62 |
4. Hyster-Yale Materials Handling, Inc. (HY): $64.36
Chairman Alfred M. Rankin acquired 20,252 shares of this lift truck manufacturing company, paying $61.13 per share for a total amount of $1.24 million. These shares were purchased indirectly through a trust.
You can view the list of recent insider transactions for Hyster-Yale Materials Handling, Inc. here.
| P/E: 31.96 | Forward P/E: 14.33 | Industry P/E: 13.71 |
| P/S: 0.34 | Price/Book: 1.91 | EV/EBITDA: 11.12 |
| Market Cap: $1.07B | Avg. Daily Volume: 51,365 | 52 Week Range: $55.88 – $91.39 |
5. FedEx Corporation (FDX): $164.43
Director David P. Steiner acquired 7,000 shares of FedEx, paying $162.92 per share for a total amount of $1.14 million. Mr. Steiner increased his stake by 36.85% to 25,994 shares with this purchase.
Mr. Steiner has served on the board of FedEx since 2009 and it has been over six years since his last insider purchase of FedEx back in August 2012 when he purchased 5,000 shares at an average price of $87.65. Despite the rebound last week, FedEx stock is down nearly 39% over the last year.
You can view the list of recent insider transactions for FedEx Corporation here.
| P/E: 8.94 | Forward P/E: 9.06 | Industry P/E: 62.43 |
| P/S: 0.62 | Price/Book: 2.22 | EV/EBITDA: 6.55 |
| Market Cap: $42.92B | Avg. Daily Volume: 2,437,179 | 52 Week Range: $150.94 – $274.66 |
You can view the full list of purchases from this Insider Buying page.
Notable Insider Sales:
1. Walmart Inc. (WMT): $93.44
Director Robson S. Walton sold 734,950 shares of Walmart for $92.48, generating $67.97 million from the sale. These shares were sold indirectly through a trust.
You can view the list of recent insider transactions for Walmart Inc. here.
| P/E: 53.36 | Forward P/E: 19.84 | Industry P/E: 38.01 |
| P/S: 0.53 | Price/Book: 3.78 | EV/EBITDA: 9.97 |
| Market Cap: $271.47B | Avg. Daily Volume: 9,472,787 | 52 Week Range: $81.78 – $109.98 |
2. Twitter, Inc. (TWTR): $29.95
Shares of Twitter were sold by 2 insiders:
You can view the list of recent insider transactions for Twitter, Inc. here.
| P/E: 22.09 | Forward P/E: 33.65 | Industry P/E: 25.67 |
| P/S: 7.93 | Price/Book: 3.52 | EV/EBITDA: 27.15 |
| Market Cap: $22.72B | Avg. Daily Volume: 24,995,679 | 52 Week Range: $22.04 – $47.79 |
3. Alphabet Inc. (GOOG): $1070.71
Shares of Alphabet were sold by 2 insiders:
You can view the list of recent insider transactions for Alphabet Inc. here.
| P/E: 40.18 | Forward P/E: 22.69 | Industry P/E: 25.67 |
| P/S: 5.76 | Price/Book: 4.39 | EV/EBITDA: 15.73 |
| Market Cap: $747.61B | Avg. Daily Volume: 1,988,040 | 52 Week Range: $970.11 – $1273.89 |
4. New Relic, Inc. (NEWR): $80.88
CEO Lewis Cirne sold 89,000 shares of this software-as-a-services provider for $76.40, generating $6.79 million from the sale. These shares were sold indirectly through a trust.
You can view the list of recent insider transactions for New Relic, Inc. here.
| P/E: N/A | Forward P/E: 101.1 | Industry P/E: 39.5 |
| P/S: 11.14 | Price/Book: 14.49 | EV/EBITDA: -747.66 |
| Market Cap: $4.61B | Avg. Daily Volume: 791,385 | 52 Week Range: $56.01 – $114.78 |
5. Palo Alto Networks, Inc. (PANW): $184.39
EVP, Chief Technology Officer Nir Zuk sold 30,000 shares of this software application company for $184.49, generating $5.53 million from the sale.
You can view the list of recent insider transactions for Palo Alto Networks, Inc. here.
| P/E: N/A | Forward P/E: 29.74 | Industry P/E: 36.65 |
| P/S: 7.21 | Price/Book: 13.94 | EV/EBITDA: 670.51 |
| Market Cap: $17.5B | Avg. Daily Volume: 1,599,079 | 52 Week Range: $148.41 – $239.5 |
You can view the full list of sales from this Insider Sales page.
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