Analyzing Wednesday's Noteworthy Insider Buys And Sells

by: GuruFundPicks

Insiders reported that on Wednesday December the 28th, they bought and sold stock in over 180 separate transactions in 109 different companies. These transactions have to be reported within two days of the trade, so the transactions occurred sometime late last week and earlier this week. We culled through these 180 or so insider buys and sells (based on 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 more info on how to interpret insider trades, please refer to the end of this article):

Ventas Inc. (VTR): VTR is a publicly-owned real estate investment trust (REIT) that engages in the investment, management, financing and leasing of hospitals, skilled nursing facilities, senior housing facilities, medical office buildings, and other healthcare related facilities in the U.S. and Canada. Insiders currently hold 2.0 million or 0.7% of outstanding shares. On Wednesday, Director Douglas Pasquale filed SEC Form 4 indicating that he sold 58,750 shares for $3.2 million, pursuant to a 10b5-1 plan, and ended with 180,059 shares (plus 4,326 shares in indirect holdings). Insider selling is relatively uncommon at VTR, and in the past year insiders sold only an additional 279,068 shares. VTR has been a long-term outperformer, rising over 15-fold since 2000. It currently trades within striking distance of its all-time highs at 17.2 times funds from operations (P/FFO) compared to the 12.4 average for its peers in the equity trust REIT group.

Resolute Energy Corp. (REN): REN is an independent oil & gas company, engaged in the acquisition, exploration, exploitation and development of oil and gas properties, primarily in UT, WY, OK, ND and AL. Insiders currently hold 12.3 million or 20.2% of outstanding shares. On Wednesday, Director and 10% plus owner Thomas Hicks, an American 'leveraged buyout' businessman that was listed at $1 billion in assets in Forbes 400 list in 2009, filed SEC Form 4 indicating that he sold 278,014 shares for $3.1 million. REN trades at the lows of the year, down 42% from the highs in February, and it trades at 26-27 forward P/E and 1.3 P/B compared to averages of 20.6 and 5.2 for its peers in the U.S. oil and gas exploration and production group.

Plains All American Pipeline (PAA): PAA is an MLP engaged in the transportation, storage, terminalling and marketing of crude oil, refined products, and liquefied petroleum gas and other natural gas-related petroleum products in the U.S. and Canada. Insiders currently hold 2.0 million or 1.4% of outstanding shares. On Wednesday, VP Tim Moore filed SEC Form 4 indicating that he sold 15,000 shares for $1.1 million, ending with 30,000 shares. This is significant because it is a large sale, the shares sold represent a significant percentage of Mr. Moore's holdings in the company, and given that the last time insiders sold was in June. PAA has been a long-term outperformer, up almost five-fold since 2000, and currently trading at all-time highs at 17 forward P/E compared to the 21 average for its peers in the oil and gas pipeline MLP group.

Cheniere Energy Inc. (LNG): Cheniere operates LNG receiving terminals and natural gas pipelines in the Gulf Coast of the U.S. including the Sabine Pass LNG terminal. Insiders currently hold 11.2 million or 13.9% of outstanding shares. On Wednesday, CEO Charif Souki filed SEC Form 4 indicating that he sold 300,000 shares for $2.5 million, transferring them to his trust over which he has indirect control. Mr. Souki now holds 1.1 million shares in direct and another 0.4 million shares in indirect holdings. Overall, insiders sold only an additional 175,000 shares in the past three months. We recently wrote about their landmark $8 billion deal for the purchase of 3.5 million tons per annum (mtpa) of liquefied natural gas via its Sabine Pass terminal facility in LA, just prior to the stock jumping from the $8.30s when the article was published on October 26th to a high of $12.56 four days later.

Carnival Corp. (CCL): CCL operates as a cruise and vacations company providing cruises to various vacation destinations with a total of 98 ships under ten brands servicing North America, Asia, Australia and Europe. Insiders currently hold 111.7 million or 14.3% of outstanding shares. On Wednesday, five insiders sold a total of 85,552 shares for $2.8 million. The sellers included CEO Stein Kruse (35,601 shares), SVP, General Counsel & Secretary Arnaldo Perez (17,800 shares), SVP David Bernstein (17,800 shares), President & CEO of PCL Alan Buckelew (11,920 shares) and Chief Accounting Officer Larry Freedman (2,431 shares). CCL is down 30% YTD and trades at 10-11 forward P/E and 1.1 P/B compared to averages of 26.8 and 4.1 for its peers in the leisure and recreation services group. However, more specifically, CCL trades at a premium to its nearest competitor Royal Caribbean Cruises (RCL) that trades at 8 forward P/E and 0.7 P/B.

Vantage Drilling Company (VTG): VTG provides offshore contract drilling services to large multinational oil and natural gas companies, government owned oil and natural gas companies, and independent oil and natural gas producers in the U.S. and internationally. Insiders currently hold 110.3 million or 38.2% of outstanding shares. On Wednesday, former Director and current 10% owner Hsin-Chi Su filed SEC Form 4 indicating that he purchased 170,646 shares for $0.2 million. The last time insiders purchased VTG shares was in August. VTG is currently generating losses and it trades near its lows, down 45% YTD.

On top of these, some additional large trades included a $28.2 million sale by Executive Chairman of the Board Eric Schmidt at Internet search and content leader (GOOG); a $2.4 million sale by Chief Innovation and Branding Officer Dennis Wilson at athletic apparel store operator Lululemon Athletica (LULU); and a $1.2 million sale by SVP of Stores William Wood at used car dealership operator Carmax Inc. (KMX);

Credit: Fundamental data in this article were based on SEC filings, I-Metrix® by Edgar Online®, Zacks Investment Research, Thomson Reuters and 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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