Raytheon: 6 Different Insiders Have Sold Shares During The Last 30 Days

Jun.13.14 | About: Raytheon Company (RTN)

Summary

6 insiders sold Raytheon stock within one month.

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

3 of these 6 insiders decreased their holdings by more than 10%.

Raytheon Company (NYSE:RTN) develops integrated products, services, and solutions in the areas of sensing; effects; command, control, communications, and intelligence; mission support; and cyber and information security worldwide.

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Insider selling during the last 30 days

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

Name Title Trade Date Shares Sold Rule 10b5-1 Current Ownership Decrease In Ownership
William Swanson Chairman June 6 42,608 Yes 647,310
shares
6.2%
Jay Stephens SVP May 30-June 6 25,038 Yes 79,961
shares
23.8%
Rebecca Rhoads VP June 2-6 4,847 Yes 33,597 shares 12.6%
Taylor Lawrence VP June 2-6 4,169 Yes 66,858
shares
5.9%
Richard Goglia VP June 2-6 2,994 Yes 21,706 shares 12.1%
Michael Wood CAO June 2 1,720 Yes 26,735
shares
6.0%
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There have been 81,376 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 Raytheon's insider activity by calendar month.

Month Insider selling / shares Insider buying / shares
June 2014 66,376 0
May 2014 15,000 0
April 2014 3,839 0
March 2014 24,257 0
February 2014 31,892 0
January 2014 0 0
December 2013 20,214 0
November 2013 0 0
October 2013 0 0
September 2013 75,404 0
August 2013 13,464 0
July 2013 0 0
June 2013 131,535 0
May 2013 0 0
April 2013 20,000 0
March 2013 10,000

0

February 2013 88,358 0
January 2013 6,000 0
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There have been 506,339 shares sold and there have been zero shares purchased by insiders since January 2013. The month of June has seen the most insider selling this year.

Financials

Raytheon reported the first-quarter financial results on April 24 with the following highlights:

Revenue $5.5 billion
Net income $596 million
Cash $4.5 billion
Debt $4.7 billion
Bookings $4.3 billion
Funded backlog $22.8 billion
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The six insiders sold their shares after this report.

Raytheon has negative revenue growth currently.

Outlook

Raytheon's 2014 guidance is as follows:

Net sales $22.5-$23.0 billion
Adjusted EPS $5.76-$5.91
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(Source: Investor presentation)

Competition

Raytheon's competitors include Boeing (NYSE:BA), Lockheed Martin (NYSE:LMT), and Northrop Grumman (NYSE:NOC). Here is a table comparing these companies.

Company RTN BA LMT NOC
Market Cap: 29.88B 96.21B 51.23B 25.66B
Employees: 63,000 168,400 115,000 65,300
Qtrly Rev Growth (yoy): -0.06 0.08 -0.04 -0.04
Revenue: 23.34B 88.20B 44.94B 24.40B
Gross Margin: 0.22 0.15 0.11 0.22
EBITDA: 3.42B 8.21B 5.62B 3.70B
Operating Margin: 0.13 0.07 0.11 0.13
Net Income: 1.99B 4.44B 3.12B 2.04B
EPS: 6.44 5.80 9.67 8.93
P/E: 14.83 22.74 16.81 13.42
PEG (5 yr expected): 1.22 1.69 1.72 1.84
P/S: 1.29 1.11 1.15 1.07
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Raytheon has the weakest revenue growth among these four companies.

Here is a table of these competitors' insider activities this year.

Company Insider buying / shares Insider selling / shares
BA 0 204,242
LMT 0 98,228
NOC 0 349,042
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Only Raytheon has seen intensive insider selling during the last 30 days.

Conclusion

There have been six different insiders selling Raytheon and there have not been any insiders buying Raytheon during the last 30 days. Three of these six insiders decreased their holdings by more than 10%. Raytheon has an insider ownership of 0.43%.

Before going short Raytheon, 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.