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Insider Weekends: Liquidity Services Rises Sharply Following CEO Purchase

  • October 10, 2020

Welcome to edition 537 of Insider Weekends. Insider buying decreased last week with insiders purchasing $60.83 million of stock compared to $119.27 million in the week prior. This is the  second week in a row we have seen a decline in insider buying. This decline in buying is probably a combination of the market once again approaching all time highs and earnings related quiet periods at a lot of companies. Selling increased with insiders selling $1.74 billion of stock last week compared to $1.69 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 28.61. In other words, insiders sold almost 29 times as much stock as they purchased. The Sell/Buy ratio this week compares unfavorably with the prior week, when the ratio stood at 14.23.

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. Element Solutions Inc (ESI): $12.21

Director Sir Martin E. Franklin acquired 500,000 shares of this specialty chemicals company, paying $11.50 per share for a total amount of $5.75 million. These shares were purchased indirectly through a trust.

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