Insider Weekends: Chuck Davis Purchases $60 Million Worth Of AXIS Capital

Welcome to edition 530 of Insider Weekends. Insider buying decreased last week with insiders purchasing $129.31 million of stock compared to $283.47 million in the week prior. Selling also decreased with insiders selling $2.09 billion of stock last week compared to $3.58 billion 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 16.18. In other words, insiders sold more than 16 times as much stock as they purchased. The Sell/Buy ratio this week compares unfavorably with the prior week, when the ratio stood at 12.64.

Insider Sector Heat Map August 21, 2020

Insider Sector Heat Map August 21, 2020 (click to enlarge)

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. AXIS Capital Holdings Limited (AXS): $45.01

Director Charles A. Davis acquired 1,332,491 shares of this insurance company, paying $45.78 per share for a total amount of $61.01 million. These shares were purchased indirectly by Trident Capital.

AXIS Capital was also at the top of our list last week and this is the fourth time since mid-June the stock has made our list because of insider purchases by Mr. Davis. This insurance and reinsurance company was impacted by the COVID-19 crisis in Q1 2020 when it reported a larger than expected loss of $1.94 per share. Things improved in Q2 with the company reporting earnings of 84 cents per share. Heading into the third quarter with multiple wildfires in California and the hurricane season spinning up on the East coast, the rest of the year is likely to remain challenging for AXIS Capital.

Mr. Davis on account of his long tenure on AXIS Capital’s Board of Directors is probably looking beyond the current issues besetting the company. He has been on AXIS Capital’s Board of Directors since the company’s inception in 2001. He is also the CEO of Stone Point Capital, a firm that raised its eighth private equity fund, Trident VIII, with $7 billion in total commitment. Before Stone Point, Mr. Davis was a partner at Goldman Sachs for 23 years.

The company does appear to be trading at an attractive valuation of 0.76 times tangible book value and has a long fifteen year history of raising its dividend. The current $1.64 annual dividend works out to a yield of 3.64%.

You can view the list of recent insider transactions for AXIS Capital Holdings Limited here.

P/E: N/A Forward P/E: 9.44 Industry P/E: 14.79
P/S: 0.77 Price/Book: 0.8 EV/EBITDA: 44.34
Market Cap: $3.79B Avg. Daily Volume: 999,678 52 Week Range: $31.82 – $67.51

2. Red Rock Resorts, Inc. (RRR): $16.86

Shares of this resorts & casinos company were acquired by 2 insiders:

  • Vice President Lorenzo J. Fertitta acquired 548,700 shares, paying $15.97 per share for a total amount of $8.76 million. These shares were purchased indirectly by various trusts and entities.
  • Chief Executive Officer Frank J. Fertitta acquired 548,700 shares, paying $15.97 per share for a total amount of $8.76 million. These shares were purchased indirectly by various trusts and entities.

Since these purchases were through various trusts, it looks like the form 4 filings might be reporting the same purchases twice, one for each brother. If this is the case, then the purchases in total were $8.76 million.

You can view the list of recent insider transactions for Red Rock Resorts, Inc. here.

P/E: N/A Forward P/E: 120.43 Industry P/E: 624.28
P/S: 1.4 Price/Book: 4.31 EV/EBITDA: 15.4
Market Cap: $1.98B Avg. Daily Volume: 2,738,507 52 Week Range: $2.76 – $27.91

3. Kinder Morgan, Inc. (KMI): $14.11

Executive Chairman Richard D. Kinder acquired 373,233 shares of this oil & gas midstream company, paying $14.09 per share for a total amount of $5.26 million. Mr. Kinder increased his stake by 0.15% to 245,212,353 shares with this purchase.

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

P/E: 198.73 Forward P/E: 14.85 Industry P/E: N/A
P/S: 2.61 Price/Book: 1 EV/EBITDA: 11.25
Market Cap: $31.94B Avg. Daily Volume: 12,774,454 52 Week Range: $9.42 – $22.58

4. Live Oak Bancshares, Inc. (LOB): $19.65

Chief Executive Officer James S. Mahan III acquired 102,879 shares of this regional bank, paying $19.33 per share for a total amount of $1.99 million. These shares were purchased indirectly through a trust.

You can view the list of recent insider transactions for Live Oak Bancshares, Inc. here.

P/E: 122.81 Forward P/E: 12.68 Industry P/E: 12.19
P/S: 4.2 Price/Book: 1.45 EV/EBITDA: N/A
Market Cap: $796.48M Avg. Daily Volume: 186,903 52 Week Range: $7.57 – $20.25

5. Verrica Pharmaceuticals Inc. (VRCA): $9.47

Shares of this pharmaceutical company were acquired by 4 insiders:

  • Director Paul B. Manning acquired 194,500 shares, paying $6.84 per share for a total amount of $1.33 million. 174,500 of these shares were purchased indirectly by BKB Growth Investments, LLC.
  • Director Sean Stalfort acquired 31,250 shares, paying $6.41 per share for a total amount of $200,463. Mr. Stalfort increased his stake by 7.25% to 462,110 shares with this purchase.
  • President and CEO Ted White acquired 10,661 shares, paying $6.28 per share for a total amount of $66,951. Mr. White increased his stake by 145.94% to 17,966 shares with this purchase.
  • Chief Financial Officer Brian Davis acquired 7,900 shares, paying $6.24 per share for a total amount of $49,296.

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

P/E: N/A Forward P/E: -5.15 Industry P/E: 31.60
P/S: N/A Price/Book: 5.05 EV/EBITDA: -6.06
Market Cap: $244.46M Avg. Daily Volume: 199,810 52 Week Range: $6.02 – $18.67

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

Notable Insider Sales:

1. Shutterstock, Inc. (SSTK): $49.24

Director Jonathan Oringer sold 2,064,000 shares of Shutterstock for $46.32, generating $95.59 million from the sale.

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

P/E: 53.64 Forward P/E: 26.33 Industry P/E: 78.81
P/S: 2.76 Price/Book: 5.12 EV/EBITDA: 27.52
Market Cap: $1.78B Avg. Daily Volume: 317,735 52 Week Range: $28.76 – $59.45

2. Intercept Pharmaceuticals, Inc. (ICPT): $48.21

Shares of this biotech company were sold by 2 insiders:

  • Director Paolo Fundaro sold 1,500,000 shares for $47.50, generating $71.25 million from the sale. These shares were sold indirectly by Genextra S.p.A.
  • Chief Medical Officer Jason Campagna sold 1,192 shares for $47.44, generating $56,543 from the sale.

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

P/E: N/A Forward P/E: -6.26 Industry P/E: N/A
P/S: 5.61 Price/Book: N/A EV/EBITDA: -5.5
Market Cap: $1.59B Avg. Daily Volume: 1,046,970 52 Week Range: $42.19 – $125

3. CarParts.com, Inc. (PRTS): $14.78

Director Mehran Nia sold 2,000,000 shares of this online provider of aftermarket auto parts and accessories for $13.00, generating $26 million from the sale. These shares were sold indirectly through a trust.

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

P/E: N/A Forward P/E: 211.14 Industry P/E: 78.81
P/S: 2.06 Price/Book: 30.79 EV/EBITDA: 123.33
Market Cap: $699.4M Avg. Daily Volume: 1,339,264 52 Week Range: $1.04 – $16.44

4. Installed Building Products, Inc. (IBP): $88.47

President, CEO and Chairman Jeffrey W. Edwards sold 300,000 shares of this building products & equipment company for $84.00, generating $25.2 million from the sale. These shares were sold indirectly by Installed Building Systems.

You can view the list of recent insider transactions for Installed Building Products, Inc. here.

P/E: 32.3 Forward P/E: 17.8 Industry P/E: 17.91
P/S: 1.66 Price/Book: 9.6 EV/EBITDA: 13.91
Market Cap: $2.64B Avg. Daily Volume: 240,296 52 Week Range: $29.02 – $90.4

5. BeiGene, Ltd. (BGNE): $240.52

Chief Executive Officer John Oyler sold 92,177 shares of this biotech company for $237.06, generating $21.85 million from the sale.

You can view the list of recent insider transactions for BeiGene, Ltd. here.

P/E: N/A Forward P/E: -17.79 Industry P/E: N/A
P/S: 95.45 Price/Book: 7.4 EV/EBITDA: -13.5
Market Cap: $21.45B Avg. Daily Volume: 276,229 52 Week Range: $114.41 – $256.01

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: 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.

Leave A Comment

You must be logged in to post a comment.