We present here two noteworthy buys and six noteworthy sells from Wednesday and Thursday's SEC Form 4 (insider trading) filings in multiple sectors, including financial, industrial and services sectors, as part of our daily and weekly coverage of insider trades (the basic materials and energy sectors, technology sector, and consumer and retail sectors were covered in separate articles, hyperlinked above).
These were selected by a review of over 790 separate transactions in over 450 different companies filed by insiders on Wednesday and Thursday. The filings are noteworthy based on the dollar amount sold, the number of insiders buying or selling, and based on whether the overall buying or selling represents a strong pick-up based on historical buying and selling in the stock:
Caterpillar Inc. (CAT): CAT is the world's largest manufacturer of construction and mining equipment, diesel and natural gas engines and industrial gas turbines. On Thursday, two insiders filed SEC Forms 4 indicating that they exercised options and sold the resulting 81,000 shares for $9.3 million, with SVP James Buda selling 54,000 shares and CFO Edward Rapp selling the remaining 27,000 shares.
Also, on Tuesday, Group President Richard Lavin filed SEC Form 4 indicating that he sold 7,000 shares. This is also in addition to the 126,000 share sale that we reported earlier at the beginning of the month, on February 4th, by Group President Steven Wunning. CAT insiders have reported selling a total of 214,000 shares in the last three-plus weeks. In comparison, insiders reported selling a total of 0.25 million shares in the past year.
CAT reported a stellar Q4 at the end of last month, on January 26th, obliterating analyst earnings estimates ($2.32 v/s $1.77) and also beating on revenue ($17.24 billion v/s $16.02 billion), and guiding both revenue and earnings above consensus. The stock has appreciated about 10% since the report, and it currently trades at 10-11 forward P/E and 5.8 P/B compared to averages of 10.6 and 2.5 for the construction and mining machinery group.
International Paper Co. (IP): IP is a paper and packaging company with worldwide operations, manufacturing containerboards, printing and writing papers, market pulp and coated paperboard. On Thursday, two insiders filed SEC Forms 4 indicating that they sold a total of 48,237 shares for $1.6 million, including 30,219 shares sold by SVP Thomas Kadien and the remaining 18,018 shares sold by SVP Tommy Joseph. This is in addition to the sale of 87,006 shares for $2.9 million that we reported just earlier this week. In comparison, insiders sold 0.33 million shares in the past year.
IP reported a good Q4 at the beginning of the month, on February 2nd, beating earnings (66c v/s 61c) and missing revenues ($6.37 billion v/s $6.52 billion). Its shares trade at 9-10 forward P/E and 2.2 P/B compared to averages of 10.6 and 4.0 for its peers in the paper and related products group.
Prudential Financial Inc. (PRU): PRU is one of the largest financial services institutions in the U.S. It offers life insurance, annuities, mutual funds and retirement products in the U.S., Europe, Asia and Latin America. On Wednesday and Thursday, three insiders filed SEC Forms 4 indicating that they exercised options to acquire 62,430 shares and sold 59,715 shares for $3.66 million. The sellers were SVP Peter Sayre (19,988 shares), SVP Sharon Taylor (19,512 shares) and SVP Susan Blount (20,215 shares). This is in addition to the sale of 64,876 shares that we reported almost two weeks ago, so that overall insiders reported selling a total of 0.14 million shares so far this month.
In comparison, insiders sold 0.16 million shares in the past year. PRU has a dividend yield of 2.4% versus the 1.9% average for its peers, and it also trades at discount 7-8 forward P/E versus the 9.1 average for its peers in the multi-line insurance group.
On top of these, some additional large insider sales reported on Wednesday and Thursday included:
- a $1.6 million sale by Director Michael Azzara at Hudson City Bancorp Inc. (HCBK), a holding company for Hudson City Savings Bank operating via 135 branches in NJ, NY and CT;
- a $1.4 million sale by CFO William Sullivan at Prologis Inc. (PLD), a REIT that acquires, develops and operates industrial properties in North America, Europe and Asia; and
- a $1.0 million sale by COO Brian MacLean at Travelers Companies Inc. (TRV), a provider of commercial and personal property and casualty insurance products and services to businesses, government units, associations and individuals primarily in the U.S.
Furthermore, insiders also reported noteworthy buys on Wednesday and Thursday in Ultralife Corp. (ULBI), a manufacturer of a wide range of portable and standby power solutions to communications and electronics systems, in which CEO Michael Popielec purchased 40,000 shares for $0.19 million.
Credit: Fundamental data in this article were based on SEC filings, 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.