WellPoint: 3 Different Insiders Have Sold Shares This Month

Dec.30.13 | About: Anthem, Inc. (ANTM)

In this article, I will feature one healthcare 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%.

WellPoint (WLP) offers network-based managed care plans to large and small employer, individual, Medicaid, and senior markets in the United States.

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Insider selling during the last 30 days

Here is a table of WellPoint'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
Richard Zoretic EVP Dec 16-26 20,889 Yes 24,432 shares 46.1%
John Cannon EVP Dec 13 9,558 No 99,331 shares 8.8%
Gloria McCarthy EVP Dec 10-11 111,867 No 57,259 shares 66.1%
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There have been 142,314 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 WellPoint's insider-trading activity by calendar month.

Month Insider selling / shares Insider buying / shares
December 2013 142,314 0
November 2013 0 0
October 2013 0 0
September 2013 562,634 0
August 2013 234,885 0
July 2013 0 0
June 2013 107,759 0
May 2013 253,619 0
April 2013 3,920 0
March 2013 10,900 0
February 2013 17,542 0
January 2013 0 0
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There have been 1,333,573 shares sold, and there have been zero shares purchased by insiders this year.


WellPoint reported the third-quarter financial results on October 23 with the following highlights:

Revenue $18.0 billion
Net income $656.2 million
Cash $21.2 billion
Debt $15.7 billion
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WellPoint's 2013 guidance is as follows:

Net income $8.45 per share
Adjusted net income $8.40 per share
Operating cash flow $3.0 billion
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(Source: November presentation)


WellPoint's competitors include Cigna (NYSE:CI), and Aetna (NYSE:AET). Here is a table comparing these companies.

Company WLP CI AET
Market Cap: 27.23B 23.92B 25.12B
Employees: 43,500 35,800 35,000
Qtrly Rev Growth (yoy): 0.17 0.10 0.46
Revenue: 68.99B 31.85B 44.04B
EBITDA: 5.50B 3.73B 3.92B
Operating Margin: 0.07 0.11 0.08
Net Income: 2.81B 1.52B 1.73B
EPS: 9.20 5.30 4.95
P/E: 10.02 16.32 13.82
PEG (5 yr expected): N/A 1.15 1.07
P/S: 0.39 0.75 0.57
Short Float: 2.32% 1.30% 1.46%
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WellPoint has the highest short float among these three companies.

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

Company Insider buying / shares Insider selling / shares
CI 4,200 411,961


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Cigna has also seen intensive insider selling during the last 30 days.


There have been three different insiders selling WellPoint, and there have not been any insiders buying WellPoint during the last 30 days. Two of these three insiders decreased their holdings by more than 10%. WellPoint has an insider ownership of 0.20%.

Before entering short WellPoint, I would like to get a bearish confirmation from the Point and Figure chart. The main reason for the proposed short entry is the intensive insider-selling activity.

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.