Many of the key purchases from this week came from insiders who had also bought in the past, including two directors from the wood pellet manufacturing company, Enviva Inc. (EVA), which we discussed last week:
Enviva (EVA) is a biomass company that manufacturers wood pellets from residual wood left over from harvesting of trees for telephone poles, furniture, etc. The company exports these wood pellets to the United Kingdom, Europe and Japan for use in power plants that can burn these wood pellets instead of using coal.
The company was the the subject of a short report by Blue Orca Capital that you can read here and the company responded by issuing a press release here. I am currently in the process of reading the book Dead Companies Walking by long/short fund manager Scott Fearon. Having seen this drama play out many times before, I agree with Fearon that companies that are doing well can for the most part ignore short sellers and continue executing on their business.
While I cannot comment on Blue Orca’s claim that Enviva is an ESG farce and that they are sourcing the wood for their pellets not just from residual wood but from clear cutting forests, many of the points they make about the company’s financials and dividend bear out. Reviewing the company’s financials, it is clear that the company is losing money, has negative free cash flow, continues to grow its long-term debt and yet chooses to pay a large dividend. Revenue growth was impressive for several years but growth appears to have tapered off in recent quarters.
Continued purchases were also made from insiders of Rocket Companies (RKT), VOXX International Corporation (VOXX), and Dave & Buster’s Entertainment (PLAY), but what stood out to us the most was Director David V. Goeddel purchasing shares in biotech company NGM Biopharmaceuticals (NGM). Dr. Goeddel’s purchase was the sixth-largest insider purchase last week, but we still chose to include it due to the interesting circumstances surrounding the transaction.
Founded by Dr. Jin-Long Chen, NGM Biopharmaceuticals is a biotech company that targets cardio-metabolic and liver diseases, age-related retinal degeneration, and the development of cancerous tumors. The stock recently dropped a little over 68% after the company announced that their drug to combat geographic atrophy (which causes blindness in elderly patients) had recently failed its Phase II trial. The drug was one of four drug candidates that were in Phase II, and all other drug candidates from NGM remain in the Phase I. The insider purchase last week was by Dr. David V. Goeddel, the very first scientist hired by the world’s first biotech company, Genentech.
Dr. Goeddel was the third employee at Genentech and worked in the molecular biology field, and later went on to co-found Tularik, a drug discovery company that centered around cell signaling and gene expression control. In 2004, Tularik was acquired by Amgen for $1.3 billion, and Dr. Goeddel became the first Senior Scientific Vice President at Amgen and worked there until 2006. From 2007 onwards, Dr. Goeddel has served as a Managing Partner of the venture capital partnership The Column Group. Dr. Goeddel was also NGM’s CEO from 2008 to 2010, was chairman of the board from 2008, and became a lead independent director in 2018.
Given Dr. Goeddel’s history with NGM and his importance in the biotech sector, we found his purchase significant. In the last two years, Dr. Goeddel has been the only insider to buy shares (mostly through The Column Group), with a large cluster of purchases from May to June of 2022. The only other insider transactions are sales and options exercises coming from Dr. Jin-Long Chen and Dr. Hsiao D. Lieu (former VP at Genentech and current Chief Medical Officer and Senior VP at NGM).
Welcome to edition 642 of Insider Weekends. Insider buying declined significantly last week with insiders purchasing $9.04 million of stock compared to $38.24 million in the week prior. Selling also decreased to $210.91 million compared to $371.61 million 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 23.33. In other words, insiders sold more than 23 times as much stock as they purchased. The Sell/Buy ratio this week was unfavorable compared to the prior week when the ratio stood at 9.72.
Notable Insider Buys:
1. Enviva Inc. (EVA): $54.16
Shares of this producer and seller of utility-grade wood pellets were acquired by 2 insiders:
- Director Jeffrey W. Ubben acquired 25,000 shares, paying $50.24 per share for a total amount of $1.26 million. These shares were purchased indirectly by In-Cap Funds.
- Director John C. Bumgarner Jr. acquired 3,288 shares, paying $49.50 per share for a total amount of $162,756. Mr. Bumgarner increased his stake by 3.74% to 91,164 shares with this purchase.
You can view the list of recent insider transactions for Enviva Inc. here.
|P/E: N/A||Forward P/E: 61.55||Industry P/E: 10.31|
|P/S: 3.47||Price/Book: 7.5||EV/EBITDA: 134.07|
|Market Cap: $3.62B||Avg. Daily Volume: 554,671||52 Week Range: $45.88 – $91.06|
2. Rocket Companies, Inc. (RKT): $6.32
Shares of this tech-driven real estate, mortgage, and e-Commerce company were acquired by 2 insiders:
- Chief Executive Officer Jay Farner acquired 149,300 shares, paying $6.69 per share for a total amount of $998,679. Mr. Farner increased his stake by 3.15% to 4,892,907 shares with this purchase.
- Director Matthew Rizik acquired 16,100 shares, paying $6.68 per share for a total amount of $107,623. Mr. Rizik increased his stake by 3.78% to 441,702 shares with this purchase.
You can view the list of recent insider transactions for Rocket Companies, Inc. here.
|P/E: 3.51||Forward P/E: 12.15||Industry P/E: 10.29|
|P/S: 1.26||Price/Book: 1.38||EV/EBITDA: 5.67|
|Market Cap: $12.56B||Avg. Daily Volume: 3,189,757||52 Week Range: $5.97 – $18.13|
3. VOXX International Corporation (VOXX): $8.13
Shares of this automotive electronics company were acquired by 2 insiders:
- Director Beat Kahli acquired 116,161 shares, paying $7.17 per share for a total amount of $832,819. These shares were purchased indirectly by Avalon Park International, LLC.
- President & CEO Patrick M. Lavelle acquired 8,234 shares, paying $6.25 per share for a total amount of $51,463. These shares were purchased indirectly by a trust.
You can view the list of recent insider transactions for VOXX International Corporation here.
|P/E: N/A||Forward P/E: 271||Industry P/E: 11.76|
|P/S: 0.31||Price/Book: 0.55||EV/EBITDA: 19.6|
|Market Cap: $191.23M||Avg. Daily Volume: 106,298||52 Week Range: $5.85 – $13.41|
4. Dave & Buster’s Entertainment, Inc. (PLAY): $36.53
SVP, Chief Operating Officer Tony Wehner acquired 14,823 shares of this entertainment and dining venues operator, paying $33.86 per share for a total amount of $501,913. Mr. Wehner increased his stake by 90.27% to 31,243 shares with this purchase.
You can view the list of recent insider transactions for Dave & Buster’s Entertainment, Inc. here.
|P/E: 13.73||Forward P/E: 9.98||Industry P/E: 11.76|
|P/S: 1.11||Price/Book: 4.94||EV/EBITDA: 12.02|
|Market Cap: $1.76B||Avg. Daily Volume: 1,030,322||52 Week Range: $29.597 – $52.535|
5. CalAmp Corp. (CAMP): $3.47
Shares of this connected intelligence company were acquired by 2 insiders:
- Director Wes Cummins acquired 150,000 shares, paying $3.26 per share for a total amount of $488,302. These shares were purchased indirectly by B. Riley Asset Management, LLC.
- President & CEO Jeffery R. Gardner acquired 2,000 shares, paying $3.36 per share for a total amount of $6,719. Mr. Gardner increased his stake by 0.41% to 487,971 shares with this purchase.
You can view the list of recent insider transactions for CalAmp Corp. here.
|P/E: N/A||Forward P/E: 13.88||Industry P/E: 20.02|
|P/S: 0.48||Price/Book: 5.89||EV/EBITDA: -487.18|
|Market Cap: $132.03M||Avg. Daily Volume: 713,134||52 Week Range: $3.07 – $10.68|
6. NGM Biopharmaceuticals, Inc. (NGM): $4.58
Director David V. Goeddel acquired 130,000 shares of this biotech company, paying $3.56 per share for a total amount of $462,396. Mr. Goeddel purchased 50,000 of these shares directly and 80,000 were purchased indirectly through a trust.
You can view the list of recent insider transactions for NGM Biopharmaceuticals, Inc. here.
|P/E: N/A||Forward P/E: -2.44||Industry P/E: 23.90|
|P/S: 5.35||Price/Book: 1.25||EV/EBITDA: -0.07|
|Market Cap: $368.08M||Avg. Daily Volume: 818,658||52 Week Range: $2.92 – $21.63|
You can view the full list of purchases from this Insider Buying page.
Notable Insider Sales:
1. Atlassian Corporation (TEAM): $194.1
Co-CEO, Co-Founder Michael Cannon-Brookes sold 43,070 shares of this software application company, for $197.52, generating $8.51 million from the sale. These shares were sold indirectly by a trust.
You can view the list of recent insider transactions for Atlassian Corporation here.
|P/E: N/A||Forward P/E: 81.21||Industry P/E: 20.02|
|P/S: 18.94||Price/Book: 147.49||EV/EBITDA: -613.63|
|Market Cap: $53.1B||Avg. Daily Volume: 1,724,387||52 Week Range: $159.54 – $483.13|
2. NVIDIA Corporation (NVDA): $124.66
Director Mark A. Stevens sold 87,500 shares of this semiconductor company for $119.65, generating $10.47 million from the sale. These shares were sold indirectly by a trust.
You can view the list of recent insider transactions for NVIDIA Corporation here.
|P/E: 33.43||Forward P/E: 28.46||Industry P/E: 20.02|
|P/S: 10.45||Price/Book: 13.01||EV/EBITDA: 28.58|
|Market Cap: $310.65B||Avg. Daily Volume: 57,693,465||52 Week Range: $108.13 – $346.47|
3. Privia Health Group, Inc. (PRVA): $32.09
Shares of this national physician-enablement company were sold by 3 insiders:
- Director Jeffrey B. Butler sold 122,413 shares for $34.57, generating $4.23 million from the sale.
- Chief Executive Officer Matthew Shawn Morris sold 50,780 shares for $34.35, generating $1.74 million from the sale. These shares were sold as a result of exercising options immediately prior to the sale.
- Director William M. Sullivan sold 49,421 shares for $33.80, generating $1.67 million from the sale. These shares were sold indirectly by Brighton Family, LLC.
You can view the list of recent insider transactions for Privia Health Group, Inc. here.
|P/E: N/A||Forward P/E: 178.28||Industry P/E: 23.90|
|P/S: 3.05||Price/Book: 7.9||EV/EBITDA: -74.9|
|Market Cap: $3.59B||Avg. Daily Volume: 954,725||52 Week Range: $17.99 – $44.64|
4. The Progressive Corporation (PGR): $122.45
Shares of this insurance holding company were sold by 2 insiders:
- President and CEO Susan Patricia Griffith sold 50,000 shares for $116.85, generating $5.84 million from the sale.
- Claims President John Jo Murphy sold 5,270 shares for $120.00, generating $632,400 from the sale.
You can view the list of recent insider transactions for The Progressive Corporation here.
|P/E: 86.23||Forward P/E: 19.25||Industry P/E: 10.29|
|P/S: 1.5||Price/Book: 4.85||EV/EBITDA: 37.74|
|Market Cap: $73.06B||Avg. Daily Volume: 2,397,528||52 Week Range: $89.66 – $129.76|
5. Inari Medical, Inc. (NARI): $73.02
Shares of this medical devices company were sold by 3 insiders:
- President and CEO William Hoffman sold 55,000 shares for $76.05, generating $4.18 million from the sale.
- Chief Financial Officer Mitch C. Hill, sold 12,750 shares for $73.77, generating $940,556 from the sale. 6,500 of these shares were sold as a result of exercising options immediately prior to the sale.
- Director Donald B. Milder sold 7,000 shares for $80.07, generating $560,490 from the sale. These shares were sold indirectly by a trust.
You can view the list of recent insider transactions for Inari Medical, Inc. here.
|P/E: N/A||Forward P/E: -331.91||Industry P/E: 23.90|
|P/S: 11.62||Price/Book: 9.41||EV/EBITDA: -5164.11|
|Market Cap: $3.9B||Avg. Daily Volume: 839,111||52 Week Range: $50.5 – $100|
You can view the full list of sales from this Insider Sales page.
Disclaimer: I own long positions in Rocket Companies (RKT) and Atlassian Corporation (TEAM). 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.