Analyzing Wednesday's Noteworthy Insider Buys And Sells

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 |  Includes: CYTX, FNFG, GTE, LOW, MNST, QLIK, SHPG, UTHR, XCO
by: GuruFundPicks

Insiders reported that on Wednesday December the 14th, they bought and sold stock in over 320 separate transactions in 197 different companies. 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 320 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 Wednesday (for a general discussion on how to interpret insider trades, please look at the end of this article):

Lowes Companies Inc. (NYSE:LOW): LOW operates as a home improvement retailer operating 1,749 stores in the U.S., Canada and Mexico. Insiders currently hold 4.1 million shares or 0.3% of outstanding shares. On Wednesday, SVP and Chief Accounting Officer Matthew Hollifield reported that he exercised options to acquire 25,334 shares and sold those and an additional 10,132 shares (regular sell) for $0.9 million, ending the day with 45,613 shares. Insider selling is relatively uncommon at LOW, as in the last three months, insiders sold only an additional 97,277 shares (buying none). Also, the shares sold are a significant portion of Mr. Hollifield’s holdings in the company. LOW trades at a discount 13-14 forward P/E compared to the 15.2 average for its peers in the building products retail and wholesale group, while earnings are projected to rise at a 10.5% compound growth rate from $1.45 in 2010 to $1.78 in 2012.

EXCO Resources Inc. (NYSE:XCO): XCO is an independent oil and natural gas company, engaged in the exploration, exploitation, development and production of onshore North American oil and natural gas properties with a focus on shale resource plays. Insiders currently hold 32.6 million or 15.4% of outstanding shares, and on Wednesday famed energy investor, and Director and 10% owner of XCO, T. Boone Pickens filed SEC Form 4 indicating that he sold 1.35 million shares (regular sell) for $13.9 million, ending with 9.3 million shares. EXCO trades at a discount 11-12 forward P/E and 1.2 P/B compared to averages of 23.1 and 5.3 for its peers in the U.S. oil & gas exploration & production group, while earnings are projected to rocket up from 53c in 2010 to 87c in 2012 at an annual growth rate of 28.1%.

First Niagara Financial Group (NASDAQ:FNFG): FNFG is a holding company for first Niagara Bank that provides retail and commercial banking, and other financial services to individual, families and businesses via over 250 offices across upstate NY and PA. Insiders currently hold 3.7 million or 1.3% of outstanding shares. On Wednesday, eight insiders reported that they bought 21,000 shares (include CFO Gregory Norwood, SVP and General Counsel John Mineo, EVP of Corporate development Oliver Sommer, and five directors) for a total of $0.5 million. This is significant also in that it is a strong pickup given that insiders bought only an additional 3,000 shares in the last three months (selling none). FNFG trades at a discount 8-9 current P/E on a TTM basis, and at 0.6 P/B, compared to averages of 13.7 and 0.7 respectively for its peers in the savings & loan group.

United Therapeutics Corp. (NASDAQ: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 Wednesday, CEO Martine Rothblatt reported that she purchased 12,966 shares for $0.5 million in trusts beneficially owned by her and her spouse, under 10b5-1 trading plans, ending the day with 631,571 shares in the trust. This is in addition to the 49,542 shares purchased that she reported purchasing earlier this month, so that Ms. Martine has reported on purchases totaling 62,508 shares in the past two weeks. 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.

Cytori Therapeutics Inc. (NASDAQ:CYTX): CYTX develops stem and regenerative cell therapies for reconstructive surgery and treatment of heart disease and other conditions, utilizing adult stem and regenerative cells derived from adipose tissue or fat. Insiders currently hold 5.4 million or 10.7% of outstanding shares. On Wednesday, Director David Rickey reported purchasing 8,000 shares for his trusts. This is in addition to the 12,000 shares that he reported purchasing just last Thursday, and the additional 30,000 shares that he purchased last month. This is unusual in that insider buying is relatively uncommon at CYTX, and in the past year insiders purchased only an additional 54,698 shares (selling 48,125 shares).

Gran Tierra Energy Inc. (NYSEMKT:GTE): GTE is engaged in oil and gas exploration in Colombia, Argentina, Peru and Brazil. Insiders currently hold 18.5 million or 7.5% of outstanding shares. On Wednesday, two insiders reported selling a total of 167,500 shares (regular sell) for $0.8 million, including CEO Dana Coffield selling 107,500 shares and COO Shane O’Leary exercising options and selling the resulting 60,000 shares. This is in addition to the 500,000 shares that Mr. Coffield reported selling earlier this week, so that insiders reported this week on selling a total of 667,500 shares for $3.3 million. This is unusual in that it is a large sell, and that insider selling is relatively uncommon at GTE as insiders sold only an additional 190,000 shares in the past year (buying 20,000 shares). GTE currently trades near its lows, at a discount 8 forward P/E and 1.2 P/B compared to averages of 15.2 and 1.5 for the Canadian Exploration and Production group.

Viropharma Inc. (VPHM): VPHM develops products for the treatment of diseases impacting patients with few if any treatment options, including drugs for hereditary angioedema, clostridium difficle infection, and seizures in children and adolescents. Insiders currently hold 6.1 million or 7.8% of outstanding shares. On Wednesday, VP & Chief Scientific Officer reported that he exercised options and sold the resulting 40,000 shares for $0.9 million, under a 10b5-1 plan, ending the day with 19,439 shares. This is also significant given that insiders sold only 364,194 shares in the past year, buying 2.01 million shares. VPHM shares powered strongly upward yesterday after the company announced approval of new labeling for its Vanocin capsules, and currently they trade at 28 forward P/E and 2.3 P/B compared to averages of 31.8 and 6.2 for its peers in the medical drugs group.

On top of these, some additional large insider trades reported Wednesday included $13.9 in insider selling at non-alcoholic beverage maker Hansen Natural Corp. (HANS), $2.2 million in insider selling at business intelligence software provider Qlik Technologies (NASDAQ:QLIK), and $1.4 million in insider selling at Mitcham Industries Inc. (NASDAQ:MIND).

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.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

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