Northern Trust: 4 Different Insiders Have Sold Shares This Year

Jan.29.14 | About: Northern Trust (NTRS)

In this article, I will feature one financial 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%.

Northern Trust Corporation (NASDAQ:NTRS) provides asset servicing, fund administration, asset management, fiduciary, and banking solutions worldwide.

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Insider selling during the last 30 days

Here is a table of Northern Trust'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
Frederick Waddell CEO Jan 24 75,000 No 430,538 shares 14.8%
Kelly Welsh EVP Jan 22 24,948 Yes 85,428 shares 22.6%
Jeffrey Cohodes EVP Jan 16 10,000 Yes


Stephen Potter President, NTGI Jan 8 23,030 Yes 103,106 shares 18.3%
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There have been 132,978 shares sold by insiders during the last 30 days. Kelly Welsh, Jeffrey Cohodes, and Stephen Potter sold shares pursuant to a Rule 10b5-1 plan. 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 Northern Trust's insider-trading activity by calendar month.

Month Insider selling / shares Insider buying / shares
January 2014 132,978 0
December 2013 0 0
November 2013 0 0
October 2013 0 0
September 2013 0 0
August 2013 0 0
July 2013 239,046 0
June 2013 0 0
May 2013 224,334 0
April 2013 76,031 0
March 2013 61,000 0
February 2013 60,000 0
January 2013 112,552 0
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There have been 905,941 shares sold, and there have been zero shares purchased by insiders since January 2013.


Northern Trust reported the 2013 full-year financial results on January 22 with the following highlights:

Revenue $4.1 billion
Net income $731.3 million
Book value $33.34 per share
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(Source: Earnings presentation)


Northern Trust's competitors include The Bank of New York Mellon Corporation (NYSE:BK), JPMorgan Chase & Co. (NYSE:JPM), and State Street Corporation (NYSE:STT). Here is a table comparing these companies.

Market Cap: 14.37B 36.80B 221.96B 29.98B
Employees: 14,800 51,100 251,196 N/A
Qtrly Rev Growth (yoy): 0.08 -0.02 0.00 0.00
Revenue: 4.07B 15.02B 96.38B 9.89B
Operating Margin: 0.26 0.27 0.28 0.28
Net Income: 719.40M 2.01B 16.59B 2.10B
EPS: 2.99 1.74 4.35 4.62
P/E: 20.25 18.41 12.66 14.78
PEG (5 yr expected): 1.58 2.01 1.59 2.22
P/S: 3.53 2.44 2.30 3.04
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Northern Trust 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.

Company Insider buying / shares Insider selling / shares
BK 0 296,303
JPM 745,086 515,034
STT 0 819,254
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Only Northern Trust has seen intensive insider selling during the last 30 days.


There have been four different insiders selling Northern Trust, and there have not been any insiders buying Northern Trust during the last 30 days. All four of these insiders decreased their holdings by more than 10%. Northern Trust has an insider ownership of 0.30%.

Before going short Northern Trust, 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.

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.