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Summary

  • 5 insiders sold NetApp stock within one month.
  • The stock was not purchased by any insiders in the month of intensive selling.
  • 2 of these 5 insiders decreased their holdings by more than 10%.

NetApp (NASDAQ:NTAP) is a provider of storage systems and data management solutions for IT infrastructures.

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Insider selling during the last 30 days

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

NameTitleTrade DateShares SoldOption Exercise & SaleRule 10b5-1Current OwnershipDecrease In Ownership
Robert WallDirectorJune 2680,000Yes & NoNo90,571
shares + 110,000 options
28.5%
George ShaheenDirectorJune 2520,000YesNo4,466
shares + 110,000 options
14.9%
Thomas GeorgensCEOJune 523,300NoNo10,329
shares + 778,646 options
2.9%
Nicholas NovielloCFOJune 3-411,519NoYes21,437
shares + 168,031
options
5.7%
Daniel WarmenhovenDirectorJune 218,423YesYes2,170,935
shares + 1,203,703
options
0.5%

There have been 153,242 shares sold by insiders during the last 30 days. Nicholas Noviello, and Daniel Warmenhoven 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 NetApp's insider activity by calendar month.

MonthInsider selling / sharesInsider buying / shares
June 2014153,2420
May 201441,7630
April 201441,7580
March 201445,5400
February 2014113,6400
January 201481,7580
December 2013218,5410
November 201391,7580
October 201330,0000
September 2013134,7660
August 2013306,7580
July 2013111,6750
June 2013199,4120
May 2013583,9310
April 201397,1520
March 2013133,5790
February 2013229,1430
January 201382,3440

There have been 2,696,760 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

NetApp reported the fiscal 2014 full-year, which ended April 25, financial results on May 21 with the following highlights:

Revenue$6.3 billion
Net income$637.5 million
Cash$5.0 billion
Debt$1.0 billion

The five insiders sold their shares after these results.

NetApp has negative revenue growth currently.

Outlook

NetApp's fiscal 2015 first-quarter guidance is as follows:

Revenue$1.420-$1.520 billion
GAAP EPS$0.32-$0.37
Non-GAAP EPS$0.53-$0.58

Competition

NetApp's competitors include EMC Corporation (NYSE:EMC), and Hewlett-Packard (NYSE:HPQ). Here is a table comparing these companies.

CompanyNTAPEMCHPQ
Market Cap:11.48B54.11B63.46B
Employees:12,49063,900317,500
Qtrly Rev Growth (yoy):-0.040.02-0.01
Revenue:6.33B23.31B111.82B
Gross Margin:0.620.620.24
EBITDA:1.03B5.54B13.11B
Operating Margin:0.130.180.08
Net Income:637.50M2.70B5.50B
EPS:1.831.262.84
P/E:19.3920.9311.94
PEG (5 yr expected):0.991.272.00
P/S:1.832.300.57

NetApp has the second-highest P/S ratio among these three companies.

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

CompanyInsider buying / sharesInsider selling / shares
EMC0331,475
HPQ0177,981

Only NetApp has seen intensive insider selling during the last 30 days.

Conclusion

There have been five different insiders selling NetApp and there have not been any insiders buying NetApp during the last 30 days. Two of these five insiders decreased their holdings by more than 10%. NetApp has an insider ownership of 0.69%.

NetApp has a $23 price target from the Point & Figure chart. I believe there is an opportunity for a short entry with the $23 price target. I would place a stop loss at $46, which is the 52-week high. The three main reasons for the proposed short entry are a bearish Point & Figure chart, negative revenue growth, and the intensive insider-selling activity.

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Disclosure: The author has no positions in any stocks mentioned, but may initiate a short position in NTAP over 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: NetApp: 5 Different Insiders Have Sold Shares This Month