Gentex: 3 Different Insiders Have Sold Shares During The Last 30 Days

May. 7.14 | About: Gentex Corporation (GNTX)

Summary

3 insiders sold Gentex stock within one month.

The stock was not purchased by any insiders in the month of intensive selling.

All 3 of these insiders decreased their holdings by more than 10%.

Gentex Corporation (NASDAQ:GNTX) is engaged in designing, developing, manufacturing, and marketing automatic-dimming rearview mirrors and electronics for the automotive industry; variable dimmable aircraft windows for the aviation industry; and commercial smoke alarms and signaling devices for the fire protection industry worldwide.

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Insider selling during the last 30 days

Here is a table of Gentex's insider activity during the last 30 days.

Name Title Trade Date Shares Sold Rule 10b5-1 Current Ownership Decrease In Ownership
Kevin Nash CAO May 2-5 6,728 No 6,975 shares + 8,365 options 30.5%
Steven Downing CFO May 2 1,750 No 15,475 shares 10.2%
Mark Newton SVP April 30 34,674 No 43,060 shares + 33,264 options 31.2%
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There have been 43,152 shares sold by insiders during the last 30 days.

Insider selling by calendar month

Here is a table of Gentex's insider activity by calendar month.

Month Insider selling / shares Insider buying / shares
May 2014 8,478 0
April 2014 34,674 0
March 2014 0 0
February 2014 17,500 0
January 2014 0 0
December 2013 4,130 0
November 2013 2,000 0
October 2013 20,500 0
September 2013 648 0
August 2013 12,000 0
July 2013 10,986 0
June 2013 2,600 0
May 2013 449,453 0
April 2013 3,355 0
March 2013 0 0
February 2013 0 0
January 2013 0 0
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There have been 566,324 shares sold, and there have been zero shares purchased by insiders since January 2013.

Financials

Gentex reported the first-quarter financial results on April 23 with the following highlights:

Revenue $335.7 million
Net income $68.6 million
Cash $374.7 million
Debt $263.8 million
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The three insiders sold their shares after these results.

Outlook

Gentex's second-quarter guidance is as follows:

Sales growth 15%-20%
Gross profit margin 39%-39.5%
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Competition

Gentex's competitors include Magna International (NYSE:MGA). Here is a table comparing these two companies.

Company GNTX MGA
Market Cap: 4.30B 21.50B
Employees: 3,801 125,000
Qtrly Rev Growth (yoy): 0.25 0.14
Revenue: 1.24B 34.84B
Gross Margin: 0.38 0.13
EBITDA: 405.13M 3.07B
Operating Margin: 0.27 0.05
Net Income: 246.07M 1.56B
EPS: 1.70 6.76
P/E: 17.47 14.47
PEG (5 yr expected): 1.29 0.83
P/S: 3.49 0.62
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Gentex has a higher P/S ratio than Magna International. In Magna International, there have been 476,588 shares sold, and there have been 963 shares purchased by insiders this year. Only Gentex has seen intensive insider selling during the last 30 days.

Conclusion

There have been three different insiders selling Gentex, and there have not been any insiders buying Gentex during the last 30 days. All three of these insiders decreased their holdings by more than 10%. Gentex has an insider ownership of 3.08%.

Gentex has a $22 price target from the Point & Figure chart. I believe there is an opportunity for a short entry with the $22 price target. I would place a stop loss at $35, which is the all-time high. The three main reasons for the proposed short entry are a bearish Point & Figure chart, relatively high P/S ratio, and the intensive insider-selling activity.

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Disclosure: I have no positions in any stocks mentioned, but may initiate a short position in GNTX over 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.