Insiders Are Selling Intel

| About: Intel Corporation (INTC)

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

  1. The stock was sold by three or more insiders within one month.
  2. The stock was not purchased by any insiders in the month of intensive selling.
  3. At least two sellers decreased their holdings by more than 10%.

Intel Corporation (NASDAQ:INTC) designs, manufactures, and sells integrated digital technology platforms worldwide.

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Insider selling during the last 30 days

Here is a table of Intel's insider-trading activity during the last 30 days by insider.

Name Title Trade Date Shares Sold Rule 10b5-1 Current Ownership Decrease In Ownership
Arvind Sodhani EVP Oct 25-Nov 1 184,231 No 100,000 shares 35.2%
Renée James President Oct 30 10,917 Yes 54,322 shares 16.7%
William Holt EVP Oct 25-30 28,310 Yes 39,046 shares + 156,482 options 12.6%
Andy Bryant Chairman Oct 29 693,630 No 521,883 shares 57.1%
Thomas Kilroy EVP Oct 25 3,379 Yes 139,289 shares 2.4%
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There have been 920,467 shares sold by insiders during the last 30 days. More details about the Rule 10b5-1 trading plan can be found from this link.

Insider selling by calendar month

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

Month Insider selling / shares Insider buying / shares
November 2013 27,206 0
October 2013 893,261 0
September 2013 103,555 0
August 2013 614,086 0
July 2013 207,946 0
June 2013 698,883 0
May 2013 407,416 0
April 2013 110,461 0
March 2013 87,692 0
February 2013 38,928 0
January 2013 47,247 0
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There have been 3,236,681 shares sold and there have been zero shares purchased by insiders this year. The month of October has seen the most insider selling.

Financials

Intel reported the third-quarter financial results on October 15 with the following highlights:

Revenue $13.5 billion
Net income $3.0 billion
Cash $19.1 billion
Debt $13.5 billion
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Outlook

Intel's guidance for the fourth quarter is as follows:

Revenue $13.7 billion, plus or minus $500 million
Gross margin percentage 61 percent, plus or minus a couple of percentage points
R&D plus MG&A spending Approximately $4.7 billion
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Competition

Here is a table of the top 5 largest semiconductor companies by sales.

Rank 2012 Rank 2011 Company Revenue 2012/2011 Changes Market Share
1 1 Intel $47,543 million -2.4% 15.7%
2 2 Samsung Electronics $30,474 million +6.7% 10.1%
3 6 Qualcomm (NASDAQ:QCOM) $12,976 million +27.2% 4.3%
4 3 Texas Instruments (NYSE:TXN) $12,008 million -14.0% 4.0%
5 4 Toshiba Semiconductor $10,996 million -13.6% 3.6%
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Intel has a negative revenue growth currently.

Here is a table of these competitors' insider-trading activities this year.

Company Insider buying / shares Insider selling / shares
QCOM 0 3,229,100
TXN 0 4,284,375
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Both Texas Instruments and Qualcomm have also seen intensive insider selling during the past 30 days.

Conclusion

There have been five different insiders selling Intel and there have not been any insiders buying Intel during the past 30 days. Four of these five insiders decreased their holdings by more than 10%. Intel has an insider ownership of 0.07%.

Intel is trading at a P/E ratio of 13.12 and a forward P/E ratio of 12.64. The company has a book value of $11.13 per share and the stock has a dividend yield of 3.71%.

Intel has a $9 price target from the Point and Figure chart. I believe there is an opportunity for a short entry with the $9 price target. I would place a stop loss at $28, which is the 5-year high. The three main reasons for the proposed short entry are bearish Point and Figure chart, negative revenue growth, and the intensive insider selling activity.

Disclosure: I have no positions in any stocks mentioned, but may initiate a short position in INTC over 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.