Welcome to edition 574 of Insider Weekends. Insider buying increased last week with insiders purchasing $197.54 million of stock purchased compared to $156.77 million in the week prior. Selling also increased to $2.28 billion compared to $1.85 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 dropped to 11.53. In other words, insiders sold almost 12 times as much stock as they purchased. The Sell/Buy ratio this week compares favorably with the prior week when the ratio stood at 11.82.
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. Asana, Inc. (ASAN): $62.73
President, CEO, & Chair Dustin A. Moskovitz acquired 800,000 shares of this project management software company, paying $56.84 per share for a total amount of $45.47 million. Mr. Moskovitz increased his stake by 34.04% to 3,150,000 shares with this purchase.
Dustin Moskovitz is one of the co-founders of Facebook, making him the youngest self-made billionaire in history in 2011. He co-founded the productivity software company, Asana, in 2008 and the company went public through a direct listing on September 30, 2020. The “reference price” for the direct listing was $21 and it closed its first day of trading at $28.80. It has more than doubled from that first day close to $62.73.
While it is unusual for insiders of a newly public company to buy shares as we highlighted with the Bumble purchases, it is even more unusual to see an insider buy shares multiple times though a defined trading plan (a 10b5-1 plan) as we have seen with Mr. Moskovitz since June 2021. The stock is already up more than $20 a share since he started buying shares. Asana’s market cap is a little over $10 billion and Mr. Moskovitz’s net worth is estimated to be over $21 billion.
There are many productivity software companies out there including Monday.com, Smartsheet (SMAR) and Atlassian (TEAM). I was an early adopter of Smartsheet (before Office 365 made Excel online a viable competitor), have held Atlassian shares for several years and nearly two decades ago wrote most of the code for an online project management module in an enterprise software application that is still in use. The barriers to entry appear low from the outside but the highly competitive nature of this industry makes it difficult for new entrants to gain enough traction to unseat incumbents unless the product is sufficiently unique or there is a lot of capital backing the company.
This Twitter thread by the CEO of a company that was an Asana competitor provides a fascinating inside look into just how competitive this little area of the software industry can be. The thread is long but the screenshot below is the money shot as it relates to Asana and Mr. Moskovitz.
Given the nature of this little niche and Asana’s valuation (31 times estimated 2021 sales), I would prefer to watch how the Asana story unfolds from the sidelines despite Mr. Moskovitz’s enthusiasm for the stock.
You can view the list of recent insider transactions for Asana, Inc. here.
|P/E: N/A||Forward P/E: N/A||Industry P/E: 59.23|
|P/S: 40.1||Price/Book: N/A||EV/EBITDA: -51.74|
|Market Cap: $10.26B||Avg. Daily Volume: 1,868,557||52 Week Range: $20.57 – $63.828|
2. Transocean Ltd. (RIG): $4.44
Shares of this offshore contract drilling services provider for oil and gas wells were acquired by 2 insiders:
- Director Frederik Wilhelm Mohn acquired 6,900,000 shares, paying $4.16 per share for a total amount of $28.67 million. These shares were purchased indirectly by Perestroika AS.
- Director Diane de Saint Victor acquired 10,000 shares, paying $4.18 per share for a total amount of $41,800. Mr. De increased his stake by inf% to 10,000 shares with this purchase.
You can view the list of recent insider transactions for Transocean Ltd. here.
|P/E: N/A||Forward P/E: -6||Industry P/E: N/A|
|P/S: 0.9||Price/Book: 0.24||EV/EBITDA: 7.41|
|Market Cap: $2.74B||Avg. Daily Volume: 20,686,151||52 Week Range: $0.65 – $4.81|
3. PennyMac Financial Services, Inc. (PFSI): $63.88
Director Farhad Nanji acquired 136,310 shares of this mortgage finance company, paying $62.20 per share for a total amount of $8.48 million. These shares were purchased indirectly by MFN Partners, LP.
You can view the list of recent insider transactions for PennyMac Financial Services, Inc. here.
|P/E: 2.85||Forward P/E: 5.76||Industry P/E: 9.59|
|P/S: 1.02||Price/Book: 1.23||EV/EBITDA: N/A|
|Market Cap: $4.26B||Avg. Daily Volume: 735,870||52 Week Range: $39.36 – $70.99|
4. Continental Resources, Inc. (CLR): $39.4
Director Harold Hamm acquired 76,486 shares of this crude oil and natural gas explorer and producer, paying $34.47 per share for a total amount of $2.64 million. Mr. Hamm increased his stake by 0.57% to 13,430,008 shares with this purchase.
You can view the list of recent insider transactions for Continental Resources, Inc. here.
|P/E: N/A||Forward P/E: 20.85||Industry P/E: N/A|
|P/S: 5.22||Price/Book: 2.25||EV/EBITDA: 9.68|
|Market Cap: $14.48B||Avg. Daily Volume: 1,854,909||52 Week Range: $11.09 – $39.73|
5. Restaurant Brands International Inc. (QSR): $65.11
Director Marc Lemann acquired 15,000 shares of this restaurant chain, paying $67.15 per share for a total amount of $1.01 million.
You can view the list of recent insider transactions for Restaurant Brands International Inc. here.
|P/E: 38.3||Forward P/E: 21.85||Industry P/E: N/A|
|P/S: 4||Price/Book: 8.43||EV/EBITDA: 19.06|
|Market Cap: $19.99B||Avg. Daily Volume: 1,163,112||52 Week Range: $51.117 – $71.12|
You can view the full list of purchases from this Insider Buying page.
Notable Insider Sales:
1. Walmart Inc. (WMT): $138.53
Shares of Walmart were sold by 2 insiders:
- Director Robson S. Walton sold 6,480,534 shares for $136.57, generating $885.06 million from the sale. These shares were sold indirectly by a trust.
- President and CEO Douglas C. McMillon sold 9,708 shares for $136.42, generating $1.32 million from the sale.
You can view the list of recent insider transactions for Walmart Inc. here.
|P/E: 32.07||Forward P/E: 22.09||Industry P/E: 31.87|
|P/S: 0.69||Price/Book: 4.96||EV/EBITDA: 10.97|
|Market Cap: $388.18B||Avg. Daily Volume: 7,836,228||52 Week Range: $118.22 – $153.66|
2. Facebook, Inc. (FB): $341.37
Shares of Facebook were sold by 2 insiders:
- COB and CEO Mark Zuckerberg sold 386,500 shares for $335.08, generating $129.51 million from the sale. These shares were sold indirectly by various entities.
- VP and General Counsel Jennifer Newstead sold 250 shares for $332.96, generating $83,240 from the sale.
You can view the list of recent insider transactions for Facebook, Inc. here.
|P/E: 29.25||Forward P/E: 22.46||Industry P/E: 33.85|
|P/S: 10.25||Price/Book: 7.26||EV/EBITDA: 20.18|
|Market Cap: $967.94B||Avg. Daily Volume: 17,657,982||52 Week Range: $207.11 – $344.9|
3. Snap Inc. (SNAP): $67.67
Chief Executive Officer Evan Spiegel sold 1,125,770 shares of Snap for $66.64, generating $75.02 million from the sale.
You can view the list of recent insider transactions for Snap Inc. here.
|P/E: N/A||Forward P/E: 101||Industry P/E: 33.85|
|P/S: 37.68||Price/Book: 60.26||EV/EBITDA: -132.11|
|Market Cap: $106.01B||Avg. Daily Volume: 21,153,757||52 Week Range: $20.61 – $73.59|
4. Regeneron Pharmaceuticals, Inc. (REGN): $550.55
President and Chief Scientific George Yancopoulos sold 80,000 shares of this biotech company for $538.90, generating $43.11 million from the sale. These shares were sold indirectly by a trust.
You can view the list of recent insider transactions for Regeneron Pharmaceuticals, Inc. here.
|P/E: 15.67||Forward P/E: 13.74||Industry P/E: N/A|
|P/S: 6.51||Price/Book: 4.76||EV/EBITDA: 14.05|
|Market Cap: $58.66B||Avg. Daily Volume: 805,837||52 Week Range: $441 – $664.64|
5. Zoom Video Communications, Inc. (ZM): $372.47
Shares of Zoom were sold by 2 insiders:
- Chief Executive Officer Eric S. Yuan sold 80,529 shares for $369.50, generating $29.76 million from the sale. These shares were sold indirectly by a trust.
- Director Carl M. Eschenbach sold 13,111 shares for $361.57, generating $4.74 million from the sale. These shares were sold indirectly by an estate planning vehicle.
You can view the list of recent insider transactions for Zoom Video Communications, Inc. here.
|P/E: 128.44||Forward P/E: 79.59||Industry P/E: 59.23|
|P/S: 33.47||Price/Book: 26.16||EV/EBITDA: 108.29|
|Market Cap: $109.75B||Avg. Daily Volume: 3,163,167||52 Week Range: $230 – $588.84|
You can view the full list of sales from this Insider Sales page.
Disclaimer: I hold long positions in Atlassian (TEAM) and Zoom (ZM). 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.