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In this article, I will feature one bank 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%.

BB&T Corporation (NYSE:BBT) operates as a financial holding company that provides various banking and trust services for retail and commercial clients.

(click to enlarge)

Insider selling during the last 30 days

Here is a table of BB&T's insider-trading activity during the last 30 days by insider.

NameTitleTrade DateShares SoldRule 10b5-1Current OwnershipDecrease In Ownership
Cynthia PowellEVPJan 227,270No32,533 shares + 38,992 options9.2%
John AllisonDirectorJan 22186,545No653,212 shares + 950,272 options10.4%
William YatesEVPJan 228,794No93,916 shares + 106,531 options4.2%
Christopher HensonCOOJan 218,938No266,028 shares + 471,233 options1.1%
Steven WiggsSVPJan 2160,746No123,346 shares + 293,293 options12.7%
Ricky BrownEVPJan 219,455No247,332 shares + 469,503 options1.3%
Cynthia WilliamsEVPJan 212,043No31,983 shares + 54,093 options2.3%
Kelly KingCEOJan 2187,727No676,331 shares + 1,189,244 options4.5%
Donna GoodrichEVPJan 217,834No137,052 shares + 262,474 options1.9%
Robert GreeneEVPJan 2147,727No192,124 shares + 421,119 options7.2%
Clarke StarnesEVPJan 215,308No172,291 shares + 296,808 options1.1%
Daryl BibleCFOJan 2160,593No151,211 shares + 284,131 options12.2%

There have been 492,980 shares sold by insiders during the last 30 days.

Insider selling by calendar month

Here is a table of BB&T's insider-trading activity by calendar month.

MonthInsider selling / sharesInsider buying / shares
January 2014492,9800
December 20137780
November 201354,6070
October 2013208,2770
September 201300
August 201300
July 201381,1840
June 201312,0000
May 2013144,7753,850
April 2013152,0290
March 201300
February 201347,9630
January 201311,5550

There have been 1,206,148 shares sold, and there have been 3,850 shares purchased by insiders since January 2013. The month of January 2014 has seen the most insider selling.

Financials

BB&T reported the full-year 2013 financial results on January 16 with the following highlights:

Interest income$6.7 billion
Net income$1.6 billion
Book value$28.52 per share
Tangible book value$18.08 per share

Competition

BB&T's competitors include Bank of America (NYSE:BAC), Regions Financial (NYSE:RF), and SunTrust Banks (NYSE:STI). Here is a table comparing these companies.

CompanyBBTBACRFSTI
Market Cap:27.04B174.24B14.53B20.40B
Employees:33,696242,11724,25526,281
Qtrly Rev Growth (yoy):0.020.28-0.060.05
Revenue:8.96B85.39B5.10B7.51B
Operating Margin:0.390.200.320.24
Net Income:1.56B10.08B1.10B1.34B
EPS:2.190.900.772.41
P/E:17.4718.2813.6815.79
PEG (5 yr expected):2.020.601.591.69
P/S:3.062.092.922.79

BB&T has the highest P/S ratio among these four companies.

Here is a table of these competitors' insider-trading activities during the last 12 months.

CompanyInsider buying / sharesInsider selling / shares
BAC40,000612,366
RF0174,681
STI20,00041,685

Only BB&T has seen intensive insider selling during the last 30 days.

Conclusion

There have been 12 different insiders selling BB&T, and there have not been any insiders buying BB&T during the last 30 days. Three of these 12 insiders decreased their holdings by more than 10%. BB&T has an insider ownership of 0.20%.

Before going short BB&T, I would like to get a bearish confirmation from the Point and Figure chart. The two main reasons for the proposed short entry are relatively high P/S ratio, and the intensive insider-selling activity.

Source: BB&T: 12 Different Insiders Have Sold Shares This Year