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:
- The stock was sold by three or more insiders within one month.
- The stock was not purchased by any insiders in the month of intensive selling.
- At least two sellers decreased their holdings by more than 10%.
ACI Worldwide (ACIW) develops, markets, installs, and supports a line of software products and services for facilitating electronic payments worldwide.
Insider selling during the last 30 days
Here is a table of ACI Worldwide'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|
|Philip Heasley||CEO||Dec 2-17||133,900||Yes||308,630 shares + 412,229 options||15.7%|
|Dennis Byrnes||EVP||Dec 17||10,000||No||57,163 shares + 13,180 options||12.4%|
|David Morem||EVP||Nov 20||12,294||No||5,916 shares||67.5%|
There have been 156,194 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 ACI Worldwide's insider-trading activity by calendar month.
|Month||Insider selling / shares||Insider buying / shares|
There have been 632,427 shares sold and there have been zero shares purchased by insiders this year.
ACI Worldwide reported the third-quarter financial results on November 7 with the following highlights:
|Net income||$13.8 million|
|Backlog (12-month)||$740 million|
ACI Worldwide's full-year 2013 guidance is as follows:
|Non-GAAP revenue||$883-$905 million|
|Non-GAAP operating income||$165-$175 million|
|Adjusted EBITDA||$257-$267 million|
ACI Worldwide is trading at the highest P/E ratio among these three companies.
Here is a table of these competitors' insider-trading activities this year.
|Company||Insider buying / shares||Insider selling / shares|
Only ACI Worldwide has seen intensive insider selling during the last 30 days.
There have been three different insiders selling ACI Worldwide and there have not been any insiders buying ACI Worldwide during the last 30 days. All three of these insiders decreased their holdings by more than 10%. ACI Worldwide has an insider ownership of 0.80%.
There is one analyst buy rating, five neutral ratings, and zero sell ratings with an average price target of $58.00. ACI Worldwide is trading at a P/E ratio of 41.15 and a forward P/E ratio of 20.73. Before entering short ACI Worldwide, I would like to get a bearish confirmation from the Point and Figure chart. The three main reasons for the proposed short entry are relatively high P/E ratio, bearish analyst price targets, and the intensive insider-selling activity.