In this article, I will feature one industrial stock that has seen intensive insider selling during the last 30 days. Intensive insider selling can be defined by the following three criteria:
- The stock was sold by three or more insiders within one month.
- The stock was not purchased by any insiders in the month of intensive selling.
- At least two sellers decreased their holdings by more than 10%.
Stanley Black & Decker (NYSE:SWK) provides power and hand tools, mechanical access solutions, and electronic security and monitoring systems for various industrial applications primarily in the United States, Canada, Europe, and Asia.
Insider selling during the last 30 days
Here is a table of Stanley Black & Decker's insider-trading activity during the last 30 days.
|Name||Title||Trade Date||Shares Sold||Rule 10b5-1||Current Ownership||Decrease In Ownership|
|Michael Bartone||VP||Feb 12||3,049||No||42,626 shares||6.7%|
|Bruce Beatt||SVP||Feb 11||5,673||No||42,992 shares||11.7%|
|Joseph Voelker||SVP||Jan 31||6,830||No|
23,579 shares + 5,625 options
There have been 15,552 shares sold by insiders during the last 30 days.
Insider selling by calendar month
Here is a table of Stanley Black & Decker's insider-trading activity by calendar month.
|Month||Insider selling / shares||Insider buying / shares|
There have been 1,014,124 shares sold, and there have been zero shares purchased by insiders since January 2013.
Stanley Black & Decker reported the full-year 2013 financial results on January 24 with the following highlights:
|Net income||$490.3 million|
Stanley Black & Decker's 2014 guidance is as follows:
|Organic revenue growth||~4%|
(Source: Investor presentation)
|Qtrly Rev Growth (yoy):||0.09||0.06||0.30|
|PEG (5 yr expected):||1.38||1.54||N/A|
Stanley Black & Decker has the highest P/E ratio among these three companies.
Here is a table of these competitors' insider-trading activities during the last six months.
|Company||Insider buying / shares||Insider selling / shares|
Only Stanley Black & Decker has seen intensive insider selling during the last 30 days.
There have been three different insiders selling Stanley Black & Decker, and there have not been any insiders buying Stanley Black & Decker during the last 30 days. Two of these three insiders decreased their holdings by more than 10%. Stanley Black & Decker has an insider ownership of 1.00%.
Stanley Black & Decker has a $56 price target from the Point and Figure chart. I believe there is an opportunity for a short entry with the $56 price target. I would place a stop loss at $92, which is the all-time high. The three main reasons for the proposed short entry are bearish Point and Figure chart, relatively high P/E ratio, and the intensive insider-selling activity.