In this article, I will feature one broadcasting 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%.
Nexstar Broadcasting Group (NASDAQ:NXST) focuses on the acquisition, development, and operation of television stations and interactive community websites in medium-sized markets in the United States.
Insider selling during the last 30 days
Here is a table of Nexstar'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|
|Thomas Carter||CFO||Dec 23||5,000||No||64,947 shares + 115,000 options||2.7%|
|Blake Russell||SVP||Dec 20||10,000||No||22,860 shares + 55,000 options||11.4%|
|Brian Jones||EVP||Dec 13||25,000||No||10,500 shares + 105,000 options||17.8%|
There have been 40,000 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 Nexstar's insider-trading activity by calendar month.
|Month||Insider selling / shares||Insider buying / shares|
There have been 8,491,519 shares sold and there have been 184 shares purchased by insiders this year.
Nexstar reported the third-quarter financial results on November 5 with the following highlights:
|Net income||$3.6 million|
(Source: December presentation)
Nexstar expects to generate free cash flow of approximately $330 million in the 2014/2015 cycle.
Nexstar has the highest P/S ratio among these three companies.
Here is a table of these competitors' insider-trading activities during the last 30 days.
|Company||Insider buying / shares||Insider selling / shares|
Only Nexstar has seen intensive insider selling during the last 30 days.
There have been three different insiders selling Nexstar and there have not been any insiders buying Nexstar during the last 30 days. Two of these three insiders decreased their holdings by more than 10%. Nexstar has an insider ownership of 0.50%.
There are five analyst buy ratings, one neutral rating, and zero sell ratings with an average price target of $54.75. Before entering short Nexstar, 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/S ratio, bearish analyst price targets, and the intensive insider-selling activity.