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In this article, I will feature one services sector 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%.

Myriad Genetics (NASDAQ:MYGN) focuses on the development and marketing of predictive medicine, personalized medicine, and prognostic medicine tests primarily in the United States.

(click to enlarge)

Insider selling during the last 30 days

Here is a table of Myriad's insider-trading activity during the last 30 days.

NameTitleTrade DateShares SoldRule 10b5-1Current OwnershipDecrease In Ownership
Richard MarshEVPFeb 1420,960No17,165 shares55.0%
Robert HarrisonCIOFeb 1213,707No324 shares97.7%
Mark CaponePresident, MGLFeb 1087,500No48,268 shares + 81,945 options40.2%
James EvansCFOFeb 735,000No47,609 shares42.4%
Peter MeldrumCEOFeb 5123,940Yes55,656 shares69.0%

There have been 281,107 shares sold by insiders during the last 30 days. Peter Meldrum 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 Myriad's insider-trading activity by calendar month.

MonthInsider selling / sharesInsider buying / shares
February 2014281,1070
January 201400
December 201300
November 201339,8560
October 201300
September 201300
August 201300
July 201300
June 201331,4980
May 2013249,1510
April 201300
March 201300
February 201300
January 201300

There have been 601,612 shares sold, and there have been zero shares purchased by insiders since January 2013. The month of February 2014 has seen the most insider selling.

Financials

Myriad reported the fiscal 2014 second-quarter, which ended December 31, financial results on February 4 with the following highlights:

Revenue$204.1 million
Net income$50.4 million
Cash$488.8 million

Outlook

Myriad's guidance for the fiscal year 2014 is as follows:

Revenue$740-$750 million
EPS$2.09-$2.12

Competition

Myriad's competitors include Quest Diagnostics (NYSE:DGX), Bio-Reference Laboratories (NASDAQ:BRLI), and Laboratory Corp. of America Holdings (NYSE:LH). Here is a table comparing these companies.

CompanyMYGNDGXBRLILH
Market Cap:2.29B7.57B758.29M8.12B
Employees:1,325N/A3,33834,000
Qtrly Rev Growth (yoy):0.370.040.180.02
Revenue:737.11M7.15B715.35M5.81B
Gross Margin:0.870.400.470.38
EBITDA:300.47M1.44B101.71M1.09B
Operating Margin:0.400.160.110.17
Net Income:187.79M811.00M45.83M573.80M
EPS:2.325.541.656.25
P/E:13.589.5016.5914.71
PEG (5 yr expected):0.991.331.051.43
P/S:3.051.051.051.40

Myriad has the highest P/S ratio among these four companies.

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

CompanyInsider buying / sharesInsider selling / shares
DGX5,00087,564
BRLI020,000
LH0196,756

Only Myriad has seen intensive insider selling during the last 30 days.

Conclusion

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

There are six analyst buy ratings, nine neutral ratings, and four sell ratings with an average price target of $29.31. Before going short Myriad, I would like to get a bearish confirmation from the Point and Figure chart. The two main reasons for the proposed short entry are bearish analyst price targets, 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.

Source: Myriad Genetics: 5 Different Insiders Have Sold Shares This Month