Welcome to edition 540 of Insider Weekends. Insider buying more than doubled last week with insiders purchasing $132.96 million of stock compared to $53.28 million in the week prior. Selling also increased with insiders selling $1.17 billion of stock last week compared to $884.13 million in the week prior.
We are currently working on the November 2020 newsletter for premium subscribers that it due out later today and hence I am going to keep this insider weekends post short on commentary.
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 8.82. In other words, insiders sold almost 9 times as much stock as they purchased. The Sell/Buy ratio this week compares favorably with the prior week, when the ratio stood at 16.59.
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. Live Oak Bancshares, Inc. (LOB): $37.28
Chief Executive Officer James S. Mahan acquired 154,384 shares of this regional bank, paying $34.18 per share for a total amount of $5.28 million. These shares were purchased indirectly through a trust.
A lot of investors have been wary of banks and especially regional banks in this low interest rate environment because it can hurt their net interest margin. The net interest margin (NIM) is the spread between the interest banks pay their depositors and the interest the banks collect on their loans. The reality it turns out has been different thanks to the double tail winds of potentially forgivable Paycheck Protection Program (PPP) loans and increased mortgage activity due to low mortgage rates. For some banks, both of these are generating significantly more fee income than is lost from the compression in NIM.
Insiders of Live Oak Bancshares have been active buyers of shares most of this year with seven different insiders buying shares. The stock is up not just from the March lows but is up more than 100% over the last year. We also saw insider buying in other regional banks like Ohio based Premier Financial (PFS) that we tweeted about last week.
You can view the list of recent insider transactions for Live Oak Bancshares, Inc. here.
P/E: 41.42 | Forward P/E: 17.58 | Industry P/E: 12.59 |
P/S: 6.6 | Price/Book: 2.59 | EV/EBITDA: N/A |
Market Cap: $1.51B | Avg. Daily Volume: 273,630 | 52 Week Range: $7.57 – $37.9 |
2. Raytheon Technologies Corporation (RTX): $54.32
Shares of this aerospace & defense company were acquired by 5 insiders:
You can view the list of recent insider transactions for Raytheon Technologies Corporation here.
P/E: N/A | Forward P/E: N/A | Industry P/E: 60.93 |
P/S: 0.99 | Price/Book: N/A | EV/EBITDA: 8.59 |
Market Cap: $82.5B | Avg. Daily Volume: 8,362,776 | 52 Week Range: $43.4361 – $2398.85 |
3. International Business Machines Corporation (IBM): $111.66
Shares of IBM were acquired by 4 insiders:
This is the first group of insider purchases since November 2018 when IBM’s former CEO Ginni Rometty and some of these same directors purchased shares. In his first six months at the helm of IBM, new CEO Arvind Krishna has not pulled off the kind of miracle Satya Nadella has performed at Microsoft but these are still early days for his stewardship of IBM.
You can view the list of recent insider transactions for International Business Machines Corporation here.
P/E: 12.66 | Forward P/E: 9.58 | Industry P/E: 54.00 |
P/S: 1.33 | Price/Book: 4.69 | EV/EBITDA: 9.69 |
Market Cap: $99.5B | Avg. Daily Volume: 4,968,747 | 52 Week Range: $90.56 – $158.75 |
4. Crown Castle International Corp. (REIT) (CCI): $156.2
Director Landis J. Martin acquired 8,050 shares of this cell towers operator, paying $161.19 per share for a total amount of $1.29 million. Mr. Martin increased his stake by 6.12% to 139,543 shares with this purchase. 1,800 of these shares were purchased indirectly through various trusts.
You can view the list of recent insider transactions for Crown Castle International Corp. (REIT) here.
P/E: 97.63 | Forward P/E: 65.63 | Industry P/E: 45.51 |
P/S: 11.66 | Price/Book: 7.09 | EV/EBITDA: 29.57 |
Market Cap: $67.32B | Avg. Daily Volume: 1,775,393 | 52 Week Range: $114.18 – $180 |
5. Agree Realty Corporation (ADC): $62.07
President & CEO Joey Agree acquired 15,293 shares of this retail REIT, paying $65.69 per share for a total amount of $1 million. Mr. Agree increased his stake by 4.10% to 388,520 shares with this purchase.
You can view the list of recent insider transactions for Agree Realty Corporation here.
P/E: 33.75 | Forward P/E: 35.67 | Industry P/E: 45.51 |
P/S: 14.99 | Price/Book: 1.51 | EV/EBITDA: 23.58 |
Market Cap: $3.44B | Avg. Daily Volume: 413,169 | 52 Week Range: $45.23 – $80.51 |
You can view the full list of purchases from this Insider Buying page.
Notable Insider Sales:
1. Align Technology, Inc. (ALGN): $426.08
Shares of this medical device company were sold by 8 insiders:
You can view the list of recent insider transactions for Align Technology, Inc. here.
P/E: 19.39 | Forward P/E: 50.97 | Industry P/E: 59.25 |
P/S: 14.68 | Price/Book: 11.07 | EV/EBITDA: 76.44 |
Market Cap: $33.57B | Avg. Daily Volume: 739,193 | 52 Week Range: $127.88 – $475.37 |
2. UnitedHealth Group Incorporated (UNH): $305.14
Director Stephen J. Hemsley sold 98,579 shares of this diversified health care company for $329.47, generating $32.48 million from the sale.
You can view the list of recent insider transactions for UnitedHealth Group Incorporated here.
P/E: 17.53 | Forward P/E: 16.64 | Industry P/E: 19.32 |
P/S: 1.15 | Price/Book: 4.31 | EV/EBITDA: 12.18 |
Market Cap: $289.99B | Avg. Daily Volume: 2,746,583 | 52 Week Range: $187.72 – $335.65 |
3. salesforce.com, inc. (CRM): $232.27
Shares of this software application company were sold by 4 insiders:
You can view the list of recent insider transactions for salesforce.com, inc. here.
P/E: 89.64 | Forward P/E: 61.61 | Industry P/E: 53.27 |
P/S: 10.91 | Price/Book: 5.49 | EV/EBITDA: 99.51 |
Market Cap: $211.37B | Avg. Daily Volume: 7,603,253 | 52 Week Range: $115.29 – $284.5 |
4. Guardant Health, Inc. (GH): $106.66
Shares of this precision oncology company were sold by 2 insiders:
You can view the list of recent insider transactions for Guardant Health, Inc. here.
P/E: N/A | Forward P/E: -86.72 | Industry P/E: 19.32 |
P/S: 41.25 | Price/Book: 9.5 | EV/EBITDA: -84.55 |
Market Cap: $10.63B | Avg. Daily Volume: 947,569 | 52 Week Range: $55.9 – $114.33 |
5. The Coca-Cola Company (KO): $48.06
Director David B. Weinberg sold 200,000 shares of The Coca-Cola Company for $50.12, generating $10.02 million from the sale. These shares were sold indirectly through a trust.
You can view the list of recent insider transactions for The Coca-Cola Company here.
P/E: 24.9 | Forward P/E: 22.78 | Industry P/E: 33.62 |
P/S: 6.17 | Price/Book: 11.1 | EV/EBITDA: 21.21 |
Market Cap: $206.53B | Avg. Daily Volume: 13,859,575 | 52 Week Range: $36.27 – $60.13 |
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.