Welcome to edition 504 of Insider Weekends. Insider buying decreased last week with insiders purchasing $100.09 million of stock compared to $177.87 million in the week prior. Selling also decreased with insiders selling $1.22 billion of stock last week compared to $5.4 billion in the week prior. The prior week’s numbers included the huge $4.06 billion sale of Amazon.com (AMZN) by Jeff Bezos.
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 12.16. In other words, insiders sold almost more than 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 30.37.
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. Avis Budget Group, Inc. (CAR): $41.3
Director Bernardo Hees acquired 430,169 shares of this vehicle rental company, paying $34.87 per share for a total amount of $14.99 million. These shares were purchased indirectly through a trust.
This appears to be a privately negotiated transaction and not an open market purchase considering the date of the transaction in the SEC filing is Sunday, February 9th and the entire trading volume on February 7th was below the number of shares acquired. We normally exclude such transactions but decided to make an exception in this case because the stock appreciated a lot following this filing of this purchase and because Mr. Hees is a partner at Brazilian private equity firm 3G Capital, a firm known for working with Berkshire Hathaway to merge Kraft with Heinz in 2015.
Mr. Hees was previously the CEO of Kraft Heinz. We wrote briefly about Kraft Heinz and an insider purchase of the company by the co-founder of 3G Capital last September.
With the Avis Budget Group trading at more than 18 times EBITDA and sporting a highly leveraged balance sheet, it is surprising to see Mr. Hees purchase stock in a global environment that is not favorable to travel on account of the COVID-19 coronavirus.
You can view the list of recent insider transactions for Avis Budget Group, Inc. here.
|P/E: 18.29||Forward P/E: 10.35||Industry P/E: 45.12|
|P/S: 0.34||Price/Book: 6.17||EV/EBITDA: 18.5|
|Market Cap: $3.05B||Avg. Daily Volume: 960,858||52 Week Range: $23.86 – $41.88|
2. Enterprise Products Partners L.P. (EPD): $26.27
Director Randa Duncan Williams acquired 250,000 shares of this independent oil & gas company, paying $25.99 per share for a total amount of $6.49 million. These shares were purchased indirectly through various trusts.
You can view the list of recent insider transactions for Enterprise Products Partners L.P. here.
|P/E: 12.6||Forward P/E: 11.47||Industry P/E: 14.83|
|P/S: 1.75||Price/Book: 2.35||EV/EBITDA: 11.28|
|Market Cap: $57.51B||Avg. Daily Volume: 5,794,627||52 Week Range: $25.04 – $30.87|
3. AMERCO (UHAL): $346.25
Chairman, President Edward J. Shoen acquired 3,000 shares of this moving and storage operator for household and commercial goods, paying $347.82 per share for a total amount of $1.04 million.
Amerco offers the U-Haul line of self-moving trucks, equipment related to moving and self-storage. While the self-storage revenue has been growing and now is their second biggest revenue generator, it represented only 11.5% of total revenue in Q4 2019. Their core self-moving trucks business accounts for more than two-thirds of total revenue and saw a modest 1% drop year-over-year.
While the stock appears cheap at just over 8 times EBITDA it has been cheap for a long time and is close to the high end of its five year EV/EBITDA range. This vote of confidence through insider buying is encouraging but I would like to see the core self-moving trucks business improve before I would get interested in Amerco, especially in light of Amazon.com’s decision to stop using their trucks for last mile deliveries.
You can view the list of recent insider transactions for AMERCO here.
|P/E: 21.18||Forward P/E: 17.33||Industry P/E: 45.12|
|P/S: 1.75||Price/Book: 1.6||EV/EBITDA: 8.93|
|Market Cap: $6.79B||Avg. Daily Volume: 45,470||52 Week Range: $333.41 – $426.5|
4. Unifi, Inc. (UFI): $24.24
Director Kenneth G. Langone acquired 66,317 shares of this textile manufacturing company, paying $23.52 per share for a total amount of $1.56 million. Mr. Langone increased his stake by 5.09% to 1,370,000 shares with this purchase.
You can view the list of recent insider transactions for Unifi, Inc. here.
|P/E: 127.58||Forward P/E: 25.25||Industry P/E: 27.87|
|P/S: 0.63||Price/Book: 1.13||EV/EBITDA: 13.91|
|Market Cap: $448.57M||Avg. Daily Volume: 87,288||52 Week Range: $15.9 – $27.85|
5. Spectrum Brands Holdings, Inc. (SPB): $60.42
Shares of this household & personal products company were acquired by 2 insiders:
- Executive Chairman and CEO David M. Maura acquired 16,709 shares, paying $59.84 per share for a total amount of $999,947. Mr. Maura increased his stake by 4.50% to 387,857 shares with this purchase.
- EVP, CFO Jeremy W. Smeltser acquired 8,305 shares, paying $60.17 per share for a total amount of $499,705.
You can view the list of recent insider transactions for Spectrum Brands Holdings, Inc. here.
|P/E: 5.43||Forward P/E: 14.52||Industry P/E: 45.67|
|P/S: 0.74||Price/Book: 1.9||EV/EBITDA: 10.75|
|Market Cap: $2.8B||Avg. Daily Volume: 512,795||52 Week Range: $45.04 – $66.5|
You can view the full list of purchases from this Insider Buying page.
Notable Insider Sales:
1. Paylocity Holding Corporation (PCTY): $147.65
Shares of this software application company were sold by 3 insiders:
- Director Steven I. Sarowitz sold 200,000 shares for $142.14, generating $28.43 million from the sale.
- Chief Executive Officer Steven R. Beauchamp sold 27,925 shares for $142.17, generating $3.97 million from the sale. These shares were sold as a result of exercising options immediately prior to the sale.
- Sr Vice President – Operations Mark S. Kinsey sold 5,000 shares for $141.96, generating $709,816 from the sale.
You can view the list of recent insider transactions for Paylocity Holding Corporation here.
|P/E: 142.25||Forward P/E: 70.31||Industry P/E: 48.03|
|P/S: 15.25||Price/Book: 23.86||EV/EBITDA: 103.18|
|Market Cap: $7.92B||Avg. Daily Volume: 362,995||52 Week Range: $78.775 – $150.03|
2. FMC Corporation (FMC): $105.47
Shares of this diversified chemical company were sold by 2 insiders:
- CEO and Chariman of Bd Pierre R. Brondeau sold 184,906 shares for $105.29, generating $19.47 million from the sale. 18,608 of these shares were sold indirectly by one or more GRATS.
- EVP and CFO Andrew D. Sandifer sold 700 shares for $106.76, generating $74,732 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 FMC Corporation here.
|P/E: 29.14||Forward P/E: 13.97||Industry P/E: 34.37|
|P/S: 2.97||Price/Book: 5.34||EV/EBITDA: 13.6|
|Market Cap: $13.67B||Avg. Daily Volume: 844,501||52 Week Range: $70.62 – $108.77|
3. ServiceNow, Inc. (NOW): $356.16
Shares of this software application company were sold by 5 insiders:
- Director Frederic B. Luddy sold 40,613 shares for $343.87, generating $13.97 million from the sale.
- Chief Product Officer Chirantan Jitendra Desai sold 4,939 shares for $345.12, generating $1.7 million from the sale. These shares were sold as a result of exercising options immediately prior to the sale.
- Chief Talent Officer Patricia L. Wadors sold 4,654 shares for $346.09, generating $1.61 million from the sale. These shares were sold as a result of exercising options immediately prior to the sale.
- President, Global Customer ops David Schneider sold 1,824 shares for $345.02, generating $629,316 from the sale. These shares were sold as a result of exercising options immediately prior to the sale.
- Principal Accounting Officer Fay Sien Goon sold 281 shares for $344.25, generating $96,735 from the sale.
You can view the list of recent insider transactions for ServiceNow, Inc. here.
|P/E: 112||Forward P/E: 64.06||Industry P/E: 48.03|
|P/S: 19.41||Price/Book: 31.64||EV/EBITDA: 226.44|
|Market Cap: $67.17B||Avg. Daily Volume: 2,552,135||52 Week Range: $213.99 – $357|
4. MarketAxess Holdings Inc. (MKTX): $345.69
Shares of this electronic trading platform were sold by 3 insiders:
- Chairman & CEO Richard M. McVey sold 25,000 shares for $339.25, generating $8.48 million from the sale.
- Chief Information Officer Nicholas Themelis sold 4,000 shares for $342.01, generating $1.37 million from the sale.
- Chief Financial Officer Antonio L. Delise sold 2,500 shares for $334.26, generating $835,638 from the sale.
You can view the list of recent insider transactions for MarketAxess Holdings Inc. here.
|P/E: 64.02||Forward P/E: 51.14||Industry P/E: 17.94|
|P/S: 25.54||Price/Book: 16.69||EV/EBITDA: 45.69|
|Market Cap: $13.06B||Avg. Daily Volume: 278,495||52 Week Range: $222.31 – $421.45|
5. Alexandria Real Estate Equities, Inc. (ARE): $174.93
Shares of this office REIT were sold by 5 insiders:
- Executive Chairman Joel S. Marcus sold 35,000 shares for $173.00, generating $6.06 million from the sale.
- Co-President Thomas J. Andrews sold 16,250 shares for $173.13, generating $2.81 million from the sale.
- EVP – Regional Market Director John H. Cunningham sold 5,590 shares for $172.73, generating $965,561 from the sale.
- Co-Chief Operating Officer Jennifer Banks sold 2,500 shares for $172.70, generating $431,750 from the sale.
- EVP – Finance & Treasurer Marc E. Binda sold 1,200 shares for $172.04, generating $206,448 from the sale.
You can view the list of recent insider transactions for Alexandria Real Estate Equities, Inc. here.
|P/E: 56.07||Forward P/E: 56.43||Industry P/E: 38.95|
|P/S: 13.92||Price/Book: 2.38||EV/EBITDA: 31.08|
|Market Cap: $21.46B||Avg. Daily Volume: 841,722||52 Week Range: $133.38 – $175.02|
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.