Seagate: 4 Different Insiders Have Sold Shares This Year

Feb.13.14 | About: Seagate Technology (STX)

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:

  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%.

Seagate Technology (NASDAQ:STX) designs, manufactures, and sells electronic data storage products.

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Insider selling during the last 30 days

Here is a table of Seagate'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
Michael Cannon Director Feb 7 25,228 No 12,837 shares 66.3%
Stephen Luczo CEO Feb 6 60,000 No 1,697,601 shares 3.4%
Jay Geldmacher Director Feb 4 4,000 No 9,798 shares 29.0%
Chong Sup Park Director Jan 30 2,270 No 38,518 shares 5.6%
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There have been 91,498 shares sold by insiders during the last 30 days.

Insider selling by calendar month

Here is a table of Seagate's insider-trading activity by calendar month.

Month Insider selling / shares Insider buying / shares
February 2014 89,228 0
January 2014 2,270 0
December 2013 0 0
November 2013 954,772 1,742
October 2013 33,058,500 0
September 2013 45,361 0
August 2013 26,121 0
July 2013 372,323 0
June 2013 11,500 0
May 2013 252,383 0
April 2013 11,500 0
March 2013 11,860 0
February 2013 200,231 0
January 2013 259,499 0
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There have been 35,295,548 shares sold, and there have been 1,742 shares purchased by insiders since January 2013.


Seagate reported the fiscal 2014 second-quarter, which ended December 27, financial results on January 27 with the following highlights:

Revenue $3.5 billion
Net income $428 million
Cash $2.3 billion
Debt $3.6 billion
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STX Revenue (<a href=

Seagate's revenues peaked 12 months ago, but the stock price has advanced 47% during the last 12 months.


In the fiscal 2014 third quarter, Seagate expects to achieve at least $3.4 billion in revenues and to maintain non-GAAP margins approximately flat sequentially.


Seagate's competitors include SanDisk (SNDK), and Western Digital Corporation (NYSE:WDC). Here is a table comparing these companies.

Market Cap: 16.23B 16.28B 20.05B
Employees: 53,200 4,636 85,777
Qtrly Rev Growth (yoy): -0.07 0.28 -0.06
Revenue: 14.11B 5.98B 15.12B
Gross Margin: 0.27 0.44 0.28
EBITDA: 2.84B 1.93B 3.20B
Operating Margin: 0.14 0.25 0.13
Net Income: 1.68B 918.42M 956.00M
EPS: 4.53 3.78 3.93
P/E: 10.90 19.12 21.62
PEG (5 yr expected): 3.46 0.51 6.26
P/S: 1.17 2.62 1.31
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Seagate has the lowest gross margin 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
SNDK 0 60,163
WDC 0 6,016
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SanDisk has also seen intensive insider selling during the last 30 days.


There have been four different insiders selling Seagate, and there have not been any insiders buying Seagate during the last 30 days. Two of these four insiders decreased their holdings by more than 10%. Seagate has an insider ownership of 4.10%.

Before going short Seagate, I would like to get a bearish confirmation from the Point and Figure chart. The two main reasons for the proposed short entry are negative revenue growth, 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.