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The Technology Select Sector SPDR ETF (NYSEARCA:XLK) was trading as low as $13.08 in March 2009. The index is currently trading at $31.82 or 143.3% above the low made in March 2009.


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In this article, I will feature one tech stock that has seen intensive insider buying during the last 30 days. Intensive insider buying can be defined by the following three criteria:

  1. The stock is purchased by three or more insiders within one month.

  2. The stock is sold by no insiders in the month of intensive purchasing.

  3. At least two purchasers increase their holdings by more than 10%.

Wi-LAN (NASDAQ:WILN) engages in the acquisition, development, and licensing of technology intellectual properties, which are utilized in products in the communications and consumer electronics markets.

Wi-LAN was trading as low as $1.35 in March 2009 and is currently trading at $3.46 or 156.3% above the 2009 low. This performance is in line with the performance of the Technology Select Sector SPDR ETF.


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Insider buying by insider (last 30 days)

  • William Jenkins purchased 3,000 shares on August 15 and currently holds 44,000 shares or less than 0.1% of the company. William Jenkins serves as a director of the company.
  • James Skippen purchased 3,000 shares on August 15 and currently holds 533,800 shares or 0.4% of the company. James Skippen is President and Chief Executive Officer of Wi-LAN.
  • Michael Vladescu purchased 36,200 shares on August 15 and currently holds 61,400 shares or less than 0.1% of the company. Michael Vladescu is Chief Operating Officer of Wi-LAN.
  • Prashant Watchmaker purchased 2,900 shares on August 16 and currently holds 45,800 shares or less than 0.1% of the company. Prashant Watchmaker is Vice President, Corporate Legal and Corporate Secretary.
  • Wi-LAN purchased 269,700 shares on July 16 - August 9.

Insider buying by calendar month

Here is a table of Wi-LAN's insider-trading activity by calendar month.

Month Insider buying / shares Insider selling / shares
August 2013 138,900 0
July 2013 200,500 0
June 2013 109,900 0
May 2013 166,300 21,900
April 2013 296,400 0
March 2013 159,500 38,400

There have been 1,071,500 shares purchased and there have been 60,300 shares sold by the insiders since March 2013.

Financials

The company reported the second-quarter financial results on August 8 with the following highlights:

Revenue $19.9 million
Adjusted loss $762,000
Cash $159.3 million
Debt $30.4 million

Outlook

For the third quarter 2013 Wi-LAN expects revenue to be at least $20.7 million. Operating expenses for the third quarter are expected to be in the range of $20.5 million to $21.6 million of which $13.5 million to $14.5 million is expected to be litigation expense. For the third quarter of 2013, and assuming no additional agreements are signed, adjusted earnings are expected to be between a loss of $650,000 and earnings of $500,000.

Competition

In the current intellectual property environment, Wi-LAN competes with numerous third parties to acquire valuable patent assets. WiLAN's competitors in the market for patent assets include both operating companies that practice the inventions claimed in such patents and other entities that seek to accumulate patent assets, patent licensing entities such as Acacia Research (NASDAQ:ACTG), Altitude Capital Partners, Coller IP, Intellectual Ventures, Millennium Partners, Rembrandt IP Management and the Rockstar Consortium and patent-buying consortiums such as RPX Corporation (NASDAQ:RPXC) and Allied Security Trust.

Acacia Research has seen 25 insider sell transactions this year. RPX Corporation has seen 97 insider sell transactions and two insider buy transactions this year.

Conclusion

There have been five different insiders buying Wi-LAN and there have not been any insiders selling Wi-LAN during the past 30 days. Two out of these five insiders increased their holdings by more than 10%. Wi-LAN has an insider ownership of 2.57%. There are seven analyst buy ratings, one neutral rating and zero sell ratings with an average target price of $6.15. The stock is trading at a forward P/E ratio of 7.06. Wi-LAN has a book value of $2.22 per share and the stock has a dividend yield of 4.30%. I believe Wi-LAN could be a good pick at the book value of $2.22 per share.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Source: Insiders Are Buying Wi-LAN