Insiders reported that on Monday December the 12th, they bought and sold $948 million of stock in over 260 separate transactions in 177 different companies, including selling $799 million worth of stock and buying $149 million worth of stock. These transactions have to be reported within two days of the trade, so the transactions reported yesterday occurred sometime after the middle of last week. We culled through these 260 or so insider buys and sells (based on yesterday’s SEC Forms 3, 4, and 5 filings), as part of our daily and weekly coverage of insider trades, and present here the most notable trades reported Monday (for a general discussion on how to interpret insider trades, please look at the end of this article):
Ford Motor (F): Ford manufactures automobiles under the Ford and Lincoln nameplates, offers a wide range of after-sales vehicle services and products, and also offers vehicle financing, leasing and insurance services. Insiders currently hold 22.8 million or 0.7% of outstanding shares. On Monday, Group VP Joseph Hinrichs reported that he exercised options and sold the resulting 116,299 shares (regular sell) for $1.3 million.
This is significant in that it is a large sell, and given that the last time insiders sold shares at Ford was in early July. Ford currently trades at 6-7 forward P/E and 7.0 P/B compared to averages of 10.0 and 4.4 for its peers in the domestic auto group. The group overall is performing well, increasing their U.S. market share, year-over-year, for the first time since 1988, partly on account of the Japanese tsunami, but also on account of the popularity of new domestic fuel-efficient cars such as the Chevy Cruze and the Ford Fiesta.
Nvidia Corp. (NVDA): NVDA is a leading designer of 3-D graphic processers, graphics processing units and related software for use in personal computers, workstations, game consoles and mobile devices. Insiders currently hold 2.4 million or 0.4% of outstanding shares. On Monday, EVP of Worldwide Sales Ajay Puri reported that he exercised and sold the resulting 503,132 shares (regular sell) for $7.4 million, ending the day with 95,529 shares. This is significant in that it is a large sell, in that the shares sold are a significant portion of Mr. Puri’s holdings in NVDA, and given that in the last three months, insiders sold only an additional 44,585 shares. Furthermore, of the 44,585 shares sold earlier, 38.585 shares were sold by Mr. Puri just two weeks ago. NVDA currently trades at 13-14 forward P/E and 2.3 P/B compared to averages of 14.2 and 3.7 for its peers in the semiconductor group.
United Therapeutics Corp. (UTHR): UTHR is a biotech company focused on developing therapies to treat cardiovascular, inflammatory and infectious diseases. Insiders currently hold 5.3 million or 9.3% of outstanding shares. On Monday, CEO Martine Rothblatt reported that she purchased 12,855 shares for $0.5 million, ending the day with 618,605 shares. This is in addition to the 38,687 shares purchased that she reported between Tuesday and the end of last week, so that Ms. Martine has reported on purchases of a total 51,542 shares for $2.2 million in the past five trading days. UTHR is currently trading near its lows, down by about 35% year-to-date. It is undervalued, trading at 10-11 forward P/E compared to the 21.1 average for the medical drugs group, while earnings are projected to grow at a much stronger 49.1% rate, from $1.79 in 2010 to $3.98 in 2012, than the average for the group.
Analog Devices (ADI): ADI manufactures analog, mixed-signal and digital signal processing ICs for industrial, telecom, consumer, and computer markets. Insiders currently hold 1.9 million or 0.7% of outstanding shares. On Monday, Chairman of the Board Ray Stata reported selling 96,968 shares (regular sell) for $3.4 million, ending the day with 1.6 million shares. This is significant in that it is a large sell, in terms of who is selling (Chairman), and given that insider selling is relatively uncommon at ADI, as insiders over the past three months sold only an additional 5,000 shares (buying none). ADI is undervalued, and currently trades at 13 forward P/E compared to the average 28.8 for the analog & mixed semiconductor group, while earnings have almost flat-lined, projected to rise from $2.72 in 2011 to $2.74 in 2013 compared to the average 12%-15% growth rate for its peers in the group.
Toll Brothers Inc. (TOL): TOL builds single-family detached and attached homes in luxury residential communities in the U.S. It is also involved in the building or converting of existing rental apartment buildings into high-, mid- and low-rise luxury homes; and developing, owning, and operating golf courses and country clubs associated with planned communities. Insiders currently hold 12.3 million or 7.7% of outstanding shares. On Monday, Director Robert Blank reported exercising options and selling the resulting 30,000 shares (regular sell) for $0.6 million, ending the day with 1,692 shares. This is in addition to two other Directors, Richard Braemer and Edward Boehne, reporting last Friday that they sold 27,985 and 46,300 shares respectively for a total of $1.5 million, so that over the past two trading days TOL insiders have reported selling stock worth over $2.1 million. This is significant in terms of the amount sold, the number of insiders selling it, and the fact that over the last three months, insiders sold only an additional 47,109 shares (buying none). TOL currently trades at a premium at 29-30 forward P/E compared to the 20.8 average for the residential and commercial building construction group.
Las Vegas Sands Corp. (LVS): LVS owns, develops and operates various integrated resort properties in the U.S., Macau, and Singapore, including The Venetian Resort Hotel Casino, The Palazzo Resort Hotel Casino, and The Sands Expo and Convention Center in Las Vegas, Nevada; the Sands Macao, The Venetian Macao Resort Hotel, the Plaza Casino, and the Four Seasons Hotel in Macau, the People’s Republic of China; and the Marina Bay Sands in Singapore. Insiders hold 48.3 million or 6.6% of the company. On Monday, President and COO Michael Leven exercised options and sold the resulting 150,000 shares (under a 10b5-1 plan) at $6.6 million, ending the week with 3,612 shares. This is significant in terms of the amount sold, the fact that it represents a significant portion of Mr. Leven’s holdings in the company, and given that insiders sold only an additional 300,000 shares (all by Mr. Leven) in the last three months. LVS currently trades at a higher 16-17 forward P/E compared to the 13.5 average for the gaming group, but it trades at a relatively fair valuation given that earnings are projected to grow at a very strong 60% annual growth rate from $1.00 in 2010 to $2.56 in 2012 compared to more modest growth rates for the rest of the group.
Broadcom Corp. (BRCM): BRCM provides a portfolio of system-on-a-chip (SoC) and software solutions for wired and wireless communications to manufacturers of computing and networking equipment, digital entertainment and broadband access products, and mobile devices. Insiders currently hold 3.1 million or 0.6% of outstanding shares. On Monday, Chief Technical Officer Henry Samueli reported selling a total of 250,000 shares via two separate filings (here and here) for $9.0 million, 50,000 of which were sold under a 10b5-1 plan, and the remaining 200,000 were regular sells. Over the last three months, insiders sold only an additional 104,226 shares (buying none). BRCM trades at a discount 11 forward P/E compared to the 14.4 average for its peers in the communications semiconductor group, while earnings are projected to fall slightly from $2.76 in 2010 to $2.68 in 2012.
On top of these, some additional large trades included a $56.4 million purchase by 10% owner Bill Gates in non-hazardous solid waste collection services company Republic Services Inc. (RSG); a $2.2 million sale by the Chief Technology Officer James Markarian at enterprise data integration software and services provider Informatica Corp. (INFA); and a $3.9 million sale by Director Dennis Powell at tax software and services provider Intuit Inc. (INTU).
Credit: Fundamental data in this article were based on SEC filings, I-Metrix® by Edgar Online®, Zacks Investment Research, Thomson Reuters and Briefing.com. The information and data is believed to be accurate, but no guarantees or representations are made.
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Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.