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Summary

  • 4 insiders sold Pacira stock within one month.
  • The stock was not purchased by any insiders in the month of intensive selling.
  • 3 of these 4 insiders decreased their holdings by more than 10%.

Pacira Pharmaceuticals (NASDAQ:PCRX) develops, commercializes, and manufactures pharmaceutical products primarily for use in hospitals and ambulatory surgery centers worldwide.

(click to enlarge)

Insider selling during the last 30 days

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

NameTitleTrade DateShares SoldRule 10b5-1Current OwnershipDecrease In Ownership
David StackCEOMay 925,000Yes19,804 shares + 170,695 options11.6%
Laura BregeDirectorMay 910,000Yes0 shares + 12,000 options45.5%
James ScibettaCFOMay 815,000Yes5,000 shares + 17,989 options39.5%
Andreas WickiDirectorMay 6-744,780Yes1,622,527 shares2.7%

There have been 94,780 shares sold by insiders during the last 30 days. All these shares were sold 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 Pacira's insider activity by calendar month.

MonthInsider selling / sharesInsider buying / shares
May 201494,7800
April 201400
March 201425,8870
February 201400
January 201400
December 201327,5000
November 201350,0000
October 201320,0000
September 201355,2831,000
August 201314,7000
July 2013458,2230
June 2013483,0540
May 2013329,313853
April 2013227,7500
March 20132,870,8860
February 201300
January 2013500,0000

There have been 5,157,376 shares sold, and there have been 1,853 shares purchased by insiders since January 2013.

Financials

Pacira reported the first-quarter financial results on May 1 with the following highlights:

Revenue$36.7 million
Net loss$11.5 million
Cash$64.6 million
Debt$101.1 million

The four insiders sold their shares after these results.

In April, Pacira raised net proceeds of $110.4 million in a public offering.

Outlook

Pacira expects to be profitable on a non-GAAP reported basis no later than the second half of this year.

Pipeline and upcoming milestones

Pacira's product portfolio consists of the following products or drug candidates.

(click to enlarge)

(Source: Pacira)

Pacira expects to submit a supplemental New Drug Application for a nerve block indication (Exparel) in the second quarter of 2014.

Competition

Pacira's competitors include Kimberly-Clark Corporation (NYSE:KMB) with I-Flow. Here is a table comparing these two companies.

CompanyPCRXKMB
Market Cap:2.62B41.75B
Employees:30857,000
Qtrly Rev Growth (yoy):2.16-0.01
Revenue:110.63M21.11B
Gross Margin:0.260.34
EBITDA:-37.12M4.22B
Operating Margin:-0.400.16
Net Income:-52.25M2.15B
EPS:-1.565.58
P/E:N/A19.86
PEG (5 yr expected):N/A2.63
P/S:24.351.98

Pacira has a lower gross margin than Kimberly-Clark. In Kimberly-Clark, there have been 123,291 shares sold, and there have been zero shares purchased by insiders this year. Kimberly-Clark has also seen intensive insider selling during the last 30 days.

Conclusion

There have been four different insiders selling Pacira, and there have not been any insiders buying Pacira during the last 30 days. Three of these four insiders decreased their holdings by more than 10%. Pacira has an insider ownership of 13.37%.

Before going short Pacira, I would like to get a bearish confirmation from the Point & Figure chart. The four main reasons for the proposed short entry are a relatively low gross margin, high P/S ratio, negative earnings, 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: Pacira Pharmaceuticals: 4 Different Insiders Have Sold Shares This Month