In a week of repeat purchases we saw increased insider buying by both the CEO of project management software company Asana (ASAN) and three additional insiders of the insurance broker SelectQuote (SLQT). We also saw insider buying of online health insurance company Oscar Health (OSCR) by its co-founder Joshua Kushner. The purchase was done indirectly through the venture capital firm Thrive Capital, which was an early investor in Instagram and counted Jared Kusher as one of its investors. Oscar Health went public at $39 a share in March 2021 and has lost more than half its value since then. Mr. Kushner and Thrive Capital started buying shares when they dipped below $13 in late August.
Welcome to edition 584 of Insider Weekends. Insider buying increased last week with insiders purchasing $116.91 million of stock purchased compared to $74.99 million in the week prior. Selling decreased to $2.49 billion compared to $3.29 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 21.36 In other words, insiders sold more than 21 times as much stock as they purchased. The Sell/Buy ratio this week was favorable compared to the prior week when the ratio stood at 43.85.
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): $97.61
President, CEO, & Chair Dustin A. Moskovitz acquired 750,000 shares of this work management platform, paying $96.49 per share for a total amount of $72.36 million. Mr. Moskovitz increased his stake by 18.99% to 4,700,000 shares with this purchase.
We wrote the following about Asana in late June and the stock is up more than 50% since then,
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: -99.6||Industry P/E: 61.92|
|P/S: 61.18||Price/Book: 64.22||EV/EBITDA: -81.33|
|Market Cap: $17.95B||Avg. Daily Volume: 2,302,828||52 Week Range: $20.57 – $102.7|
2. Oscar Health, Inc. (OSCR): $17.5
Co-Founder and Vice Chairman Joshua Kushner acquired 485,486 shares of this health insurance products and services provider, paying $18.07 per share for a total amount of $8.77 million. These shares were purchased indirectly by Thrive Capital Partners VII Growth, L.P.
You can view the list of recent insider transactions for Oscar Health, Inc. here.
|P/E: N/A||Forward P/E: -11.29||Industry P/E: 10.76|
|P/S: 3.31||Price/Book: 2.09||EV/EBITDA: -3.52|
|Market Cap: $3.63B||Avg. Daily Volume: 1,073,231||52 Week Range: $12.06 – $37|
3. Ault Global Holdings, Inc. (DPW): $2.79
Executive Chairman Milton C. Ault III acquired 1,000,000 shares of this power system solutions seller, paying $2.72 per share for a total amount of $2.72 million. These shares were purchased indirectly by Ault Alpha LP.
You can view the list of recent insider transactions for Ault Global Holdings, Inc. here.
|P/E: 4.51||Forward P/E: N/A||Industry P/E: 45.29|
|P/S: 1.87||Price/Book: 0.68||EV/EBITDA: 0.8|
|Market Cap: $165.33M||Avg. Daily Volume: 4,257,795||52 Week Range: $1.44 – $10.94|
4. SelectQuote, Inc. (SLQT): $13.01
Shares of this insurance broker were acquired by 3 insiders:
- Director Thomas W. Grant II acquired 144,533 shares, paying $12.42 per share for a total amount of $1.79 million. Mr. Grant increased his stake by 20.80% to 839,277 shares with this purchase.
- Director Denise L. Devine acquired 1,500 shares, paying $11.14 per share for a total amount of $16,703. Mr. Devine increased his stake by 60.00% to 4,000 shares with this purchase.
- Director Earl H. Devanny III acquired 1,000 shares, paying $12.75 per share for a total amount of $12,750. These shares were purchased indirectly through a trust.
These purchases follow purchases by 5 member of the management team last week and we wrote the following after those purchases,
SelectQuote is a company very similar to GoHealth (GOCO), an online insurance broker we featured as a spotlight idea in our Special Situations Newsletter. Just like GOCO, the stock has been hit hard in recent weeks. Both companies posted big increases in top line numbers and both have seen insider buying recently. While GOCO focuses on health insurance and specifically Medicare, SelectQuote also lets customers shop for term life, home and auto insurance online.
I dug into the company some more after writing about it last week and can see why the insiders are buying. It is fascinating that the market is not particularly enthused by these online insurance brokerage companies despite their high growth and low valuations.
You can view the list of recent insider transactions for SelectQuote, Inc. here.
|P/E: 16.47||Forward P/E: 8.91||Industry P/E: 10.76|
|P/S: 2.27||Price/Book: 3.15||EV/EBITDA: 11.16|
|Market Cap: $2.13B||Avg. Daily Volume: 2,513,948||52 Week Range: $7.72 – $33|
5. Petco Health and Wellness Company, Inc. (WOOF): $21.76
CEO & Chairman Ron Coughlin acquired 46,600 shares of this pet products retailer, paying $21.72 per share for a total amount of $1.01 million. Mr. Coughlin increased his stake by 22.37% to 254,934 shares with this purchase.
You can view the list of recent insider transactions for Petco Health and Wellness Company, Inc. here.
|P/E: 66.75||Forward P/E: 25.01||Industry P/E: 20.67|
|P/S: 1.21||Price/Book: 2.64||EV/EBITDA: 18.62|
|Market Cap: $6.57B||Avg. Daily Volume: 3,264,807||52 Week Range: $17.86 – $31.08|
You can view the full list of purchases from this Insider Buying page.
Notable Insider Sales:
1. Walmart Inc. (WMT): $145.89
Director Robson Walton sold 2,000,962 shares of Walmart for $147.11, generating $294.35 million from the sale. These shares were sold indirectly through a trust.
You can view the list of recent insider transactions for Walmart Inc. here.
|P/E: 41.06||Forward P/E: 22.14||Industry P/E: 32.77|
|P/S: 0.72||Price/Book: 5.06||EV/EBITDA: 11.18|
|Market Cap: $406.81B||Avg. Daily Volume: 7,500,359||52 Week Range: $126.28 – $153.66|
2. Facebook, Inc. (FB): $378.69
Shares of Facebook were sold by 2 insiders:
- COB and CEO Mark Zuckerberg sold 309,200 shares for $377.38, generating $116.69 million from the sale. These shares were sold indirectly by various entities.
- Chief Legal Officer Jennifer Newstead sold 250 shares for $375.90, generating $93,975 from the sale.
You can view the list of recent insider transactions for Facebook, Inc. here.
|P/E: 28.12||Forward P/E: 23.54||Industry P/E: 31.00|
|P/S: 10.19||Price/Book: 7.74||EV/EBITDA: 19.51|
|Market Cap: $1.07T||Avg. Daily Volume: 13,620,871||52 Week Range: $244.13 – $384.33|
3. Bill.com Holdings, Inc. (BILL): $281.04
Shares of this cloud-based software provider were sold by 6 insiders:
- CEO, DivvyPay, LLC Blake Thomas Murray sold 264,748 shares for $293.12, generating $77.6 million from the sale. These shares were sold indirectly by BTM Investment Holdings, LLC.
- President and CEO Rene A. Lacerte sold 25,000 shares for $298.55, generating $7,463,639 from the sale. These shares were sold as a result of exercising options immediately prior to the sale.
- CFO John R. Rettig sold 8,333 shares for $294.39, generating $2,453,123 from the sale.
- Director Steven Cakebread sold 2,000 shares for $295.00, generating $590,000 from the sale. These shares were sold as a result of exercising options immediately prior to the sale.
- General Counsel & CCO Rajesh A. Aji sold 131 shares for $292.53, generating $38,321 from the sale.
- Chief Revenue Officer Thomas J. Clayton sold 94 shares for $292.53, generating $27,498 from the sale.
You can view the list of recent insider transactions for Bill.com Holdings, Inc. here.
|P/E: N/A||Forward P/E: -425.82||Industry P/E: 61.92|
|P/S: 114.16||Price/Book: 10.5||EV/EBITDA: -294.72|
|Market Cap: $27.2B||Avg. Daily Volume: 1,271,565||52 Week Range: $82.19 – $301.99|
4. Arista Networks, Inc. (ANET): $350.92
Chief Development Officer Andreas Bechtolsheim sold 130,888 shares of this networking company for $362.35, generating $47.43 million from the sale. 59,135 of 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 Arista Networks, Inc. here.
|P/E: 38.3||Forward P/E: 29.51||Industry P/E: 33.43|
|P/S: 10.24||Price/Book: 7.28||EV/EBITDA: 27.7|
|Market Cap: $26.92B||Avg. Daily Volume: 419,065||52 Week Range: $192.96 – $384|
5. Netflix, Inc. (NFLX): $598.72
Shares of Netflix were sold by 3 insiders:
- Director Jay C. Hoag sold 35,401 shares for $600.35, generating $21.25 million from the sale. These shares were sold indirectly through a trust.
- COO and Chief Product Officer Gregory K. Peters sold 6,941 shares for $600.00, generating $4.16 million from the sale. These shares were sold as a result of exercising options immediately prior to the sale.
- Director Ann Mather sold 809 shares for $600.00, generating $485,400 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 Netflix, Inc. here.
|P/E: 62.04||Forward P/E: 46.67||Industry P/E: 234.01|
|P/S: 9.61||Price/Book: 19.11||EV/EBITDA: 44.3|
|Market Cap: $264.99B||Avg. Daily Volume: 3,418,031||52 Week Range: $458.6 – $615.6|
You can view the full list of sales from this Insider Sales page.
Disclaimer: I hold a long position in GoHealth (GOCO). 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.