Seeking Alpha
Long/short equity, insider ownership
Profile| Send Message|
( followers)  

Summary

  • Three insiders sold General Mills stock within one month.
  • The stock was not purchased by any insiders in the month of intensive selling.
  • All three of these insiders decreased their holdings by more than 10%.

General Mills (NYSE:GIS) produces and markets branded consumer foods in the United States and internationally.

(click to enlarge)

Insider selling during the last 30 days

Here is a table of General Mills' insider activity during the last 30 days.

NameTitleTrade DateShares SoldRule 10b5-1Current OwnershipDecrease In Ownership
Kimberly NelsonSVPApril 952,201No122,092 shares30.0%
Judith Richards HopeDirectorApril 710,000No74,194 shares11.9%
John ChurchEVPMarch 27-28134,912No117,006 shares53.6%

There have been 197,113 shares sold by insiders during the last 30 days.

Insider selling by calendar month

Here is a table of General Mills' insider activity by calendar month.

MonthInsider selling / sharesInsider buying / shares
April 201462,2010
March 2014134,9120
February 201400
January 201400
December 201300
November 201300
October 201332,4000
September 201300
August 20133,3000
July 2013101,0080
June 201300
May 201310,5260
April 201370,0000
March 20135,0840
February 201312,4600
January 20136,7920

There have been 438,683 shares sold, and there have been zero shares purchased by insiders since January 2013. The month of March 2014 has seen the most insider selling.

Financials

General Mills reported the fiscal 2014 third-quarter, which ended February 23, financial results on March 19 with the following highlights:

Revenue$4.4 billion
Net income$410.6 million
Cash$847.1 million
Debt$8.9 billion

(click to enlarge)

(Source: Earnings presentation)

The three insiders sold their shares after these results.

Outlook

General Mills' guidance is as follows:

(click to enlarge)

(Source: Earnings presentation)

Competition

General Mills' competitors include Kellogg (NYSE:K). Here is a table comparing these two companies.

CompanyGISK
Market Cap:31.43B23.76B
Employees:41,00030,277
Qtrly Rev Growth (yoy):-0.01-0.02
Revenue:18.04B14.79B
Gross Margin:0.360.41
EBITDA:3.50B3.68B
Operating Margin:0.160.21
Net Income:1.79B1.81B
EPS:2.734.94
P/E:18.7613.30
PEG (5 yr expected):2.492.82
P/S:1.741.60

General Mills has a higher P/E ratio than Kellogg. In Kellogg, there have been 516,870 shares sold and there have been zero shares purchased by insiders this year. Only General Mills has seen intensive insider selling during the last 30 days.

Conclusion

There have been three different insiders selling General Mills, and there have not been any insiders buying General Mills during the last 30 days. All three of these insiders decreased their holdings by more than 10%. General Mills has an insider ownership of 0.11%.

Before going short General Mills, I would like to get a bearish confirmation from the Point & Figure chart. The two main reasons for the proposed short entry are negative revenue growth and the intensive insider-selling activity.

Source: General Mills: 3 Different Insiders Have Sold Shares During The Last 30 Days