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Summary

  • 9 insiders sold Cisco stock within one month.
  • The stock was not purchased by any insiders in the month of intensive selling.
  • 6 of these 9 insiders decreased their holdings by more than 10%.

Cisco Systems (NASDAQ:CSCO) designs, manufactures, and sells Internet Protocol and other products related to the communications and information technology industry worldwide.

(click to enlarge)

Insider selling during the last 30 days

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

NameTitleTrade DateShares SoldOption Exercise & SaleRule 10b5-1Current OwnershipDecrease In Ownership
Pankaj PatelEVPMay 19-June 1060,000NoYes1,002,364 shares + 855,000 options3.1%
Blair ChristieSVPMay 19-June 10309,083Yes & NoYes280,739 shares + 100,000 options44.8%
John ChambersCEOMay 19-June 102,300,000Yes & NoYes2,098,733
shares + 3,075,000 options
30.8%
Michele BurnsDirectorMay 23-3030,000Yes & NoNo59,864
shares + 30,000 options
25.0%
Steven WestDirectorMay 2025,000NoNo46,099 shares + 30,000 options24.7%
Charles RobbinsSVPMay 1970,000YesYes580,297
shares + 218,667
options
8.1%
Gary MooreCOOMay 19137,500YesYes642,154
shares + 590,000 options
10.0%
Roderick McGearyDirectorMay 2020,000YesNo109,622
shares + 30,000 options
12.5%
Frank CalderoniCFOMay 19178,750YesYes638,531
shares + 1,040,000 options
9.6%

There have been 3,130,333 shares sold by insiders during the last 30 days. Pankaj Patel, Blair Christie, John Chambers, Charles Robbins, Gary Moore, and Frank Calderoni sold their 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 Cisco's insider activity by calendar month.

MonthInsider selling / sharesInsider buying / shares
June 2014353,3110
May 20142,875,1930
April 201400
March 201450,2260
February 2014149,0760
January 201400
December 201310,0000
November 2013162,2260
October 201300
September 20131,108,9410
August 2013205,0000
July 201300
June 201397,0300
May 20132,194,8140
April 201300
March 2013591,929

0

February 2013209,8030
January 201325,0000

There have been 8,032,549 shares sold and there have been zero shares purchased by insiders since January 2013. The month of May 2014 has seen the most insider selling.

Financials

Cisco reported the fiscal 2014 third-quarter, which ended April 27, financial results on May 14 with the following highlights:

Revenue$11.5 billion
Net income$2.2 billion
Cash$50.5 billion
Debt$20.9 billion

The nine insiders sold their shares after these results.

Cisco has negative revenue growth currently.

Outlook

Cisco's fourth-quarter guidance is as follows:

Revenue growth (year-over-year)-3% to -1%
Non-GAAP EPS$0.51-$0.53

Competition

Cisco's competitors include Alcatel-Lucent (NYSE:ALU), Hewlett-Packard (NYSE:HPQ), and Juniper Networks (NYSE:JNPR). Here is a table comparing these companies.

CompanyCSCOALUHPQJNPR
Market Cap:128.27B10.70B62.84B11.68B
Employees:73,84962,311317,5009,483
Qtrly Rev Growth (yoy):-0.06-0.03-0.010.11
Revenue:47.20B19.58B111.82B4.78B
Gross Margin:0.590.330.240.63
EBITDA:12.87B1.06B13.18B812.70M
Operating Margin:0.220.020.080.13
Net Income:7.88B-1.41B5.50B459.40M
EPS:1.48-0.562.840.90
P/E:16.90N/A11.7027.40
PEG (5 yr expected):1.590.641.961.08
P/S:2.720.550.562.44

Cisco has the highest P/S ratio among these four companies. Hewlett-Packard and Juniper have also seen insider selling during the last 30 days.

Conclusion

There have been nine different insiders selling Cisco and there have not been any insiders buying Cisco during the last 30 days. Six of these nine insiders decreased their holdings by more than 10%. Cisco has an insider ownership of 0.09%.

Before going short Cisco, 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.

Disclosure: The author has no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. The author wrote this article themselves, and it expresses their own opinions. The author is not receiving compensation for it (other than from Seeking Alpha). The author has no business relationship with any company whose stock is mentioned in this article.

Source: Cisco: 9 Different Insiders Have Sold Shares During The Last 30 Days