I screened with Open Insider for insider sell transactions filed on October 9. From this list, I chose the top five stocks with insider selling in dollar terms. Here is a look at the top five stocks:
1. WageWorks (WAGE) is a leading provider of consumer-directed benefit programs in the United States. WageWorks administers and operates a broad array of products, including spending account management programs, such as health and dependent care Flexible Spending Accounts [FSAs], Health Savings Accounts [HSAs], Health Reimbursement Arrangements [HRAs] and commuter benefits.
Vantagepoint Venture Associates IV sold 4,641,636 shares on October 9. Vantagepoint Venture Associates IV is a 10% owner of WageWorks according to SEC filings.
The company reported the second-quarter financial results on August 9 with the following highlights:
|Net income||$2.4 million|
The company's guidance for the third quarter and the full-year 2012 is as follows:
|Net income [GAAP]||$2.0-$2.3 million||$6.8-$7.4 million|
|Net income [non-GAAP]||$3.5-$3.8 million||$15.7-$16.3 million|
The company had an Initial Public Offering in May 2012. There has been one insider sell transaction and there have been two insider buy transactions since the IPO. The stock is trading at a forward P/E ratio of 36.75. I have currently a neutral bias for the stock currently.
2. Google (GOOG) is a global technology leader focused on improving the ways people connect with information. Google's innovations in web search and advertising have made its website a top internet property and its brand one of the most recognized in the world.
- Lawrance Page sold 20,833 shares on October 8, 27,778 shares on September 12, 27,778 shares on September 11 and 27,778 shares on September 10 pursuant to a Rule 10b5-1 trading plan. Lawrance Page currently holds 25,631,093 shares of the company. Lawrance Page is the CEO of the company.
- Sergey Brin sold 83,334 shares on October 2 pursuant to a Rule 10b5-1 trading plan. Sergey Brin is the co-founder of the company.
- John Doerr sold 10,966 shares on October 1 and 12,285 shares on September 4 pursuant to a Rule 10b5-1 trading plan adopted by the Reporting Person. John Doerr serves as a director of the company.
- David Drummond sold 568 shares on October 1. David Drummond is Senior Vice President, Corporate Development.
- Nikesh Arora sold 1,218 shares on September 12 pursuant to a Rule 10b5-1 trading plan. Nikesh Arora serves as SVP and Chief Business Officer of the company.
- Patrick Pichette sold 1,964 shares on September 10. Patrick Pichette is SVP & Chief Financial Officer of the company.
- Kavitark Shriram sold 72,604 shares on September 7. Kavitark Shriram serves as a director of the company.
- John Hennessy sold 74 shares on September 4. John Hennessy serves as a director of the company.
- Eric Schmidt sold 50,000 shares on August 29 and 103,193 shares on August 27-28. Eric Schmidt serves as Executive Chairman of Board.
The company reported the second-quarter financial results on July 19 with the following highlights:
|Net income||$2.8 billion|
The stock has a $685 price target from the Point and Figure chart which has been met already. The stock has seen steady insider selling this year with 2,224,810 shares sold during the last 6 months. There has not been any insider buying during the last 6 months. The stock is trading at a forward P/E ratio of 15.11. The stock is currently trading very close to its all time high level. I have a neutral bias for the stock currently.
3. MetroPCS Communications (PCS) is a provider of no annual contract, unlimited wireless communications service for a flat rate. MetroPCS is the fifth largest facilities-based wireless carrier in the United States based on number of subscribers served. With Metro USA, MetroPCS customers can use their service in areas throughout the United States covering a population of over 280 million people. As of June 30, 2012, MetroPCS had approximately 9.3 million subscribers.
- Ta Associates sold 543,465 shares on October 4-8 and 733,466 shares on October 1-3 pursuant to a Rule 10b5-1 trading plans adopted by TA Associates on February 29, 2012 and March 1, 2012.
- J. Braxton Carter sold 10,000 shares on October 2 pursuant to a Rule 10b5-1 trading plan adopted by the reporting person on May 5, 2011.J. Braxton Carter became MetroPCS Communications' Chief Financial Officer and Vice Chairman in May 2011.
The company reported the second-quarter financial results on July 26 with the following highlights:
|Net income||$149 million|
MetroPCS currently expects to incur capital expenditures in the range of $900 million to $1.0 billion on a consolidated basis for the year ending December 31, 2012.
Deutsche Telekom (DTEGY.PK) and MetroPCS Communications announced on October 3 that they have signed a definitive agreement to combine T-Mobile USA and MetroPCS. This transaction will create the leading value carrier in the U.S. wireless marketplace, which will deliver an enhanced customer experience through a wider selection of affordable products and services, deeper network coverage and a clear-cut technology path to one common LTE network. The combined company, which will retain the T-Mobile name, will have the expanded scale, spectrum and financial resources to aggressively compete with the other national U.S. wireless carriers.
Deutsche Telekom's supervisory board and MetroPCS' board of directors approved the transaction. The transaction is structured as a recapitalization, in which MetroPCS will declare a 1 for 2 reverse stock split, make a cash payment of $1.5 billion to its shareholders (approximately $4.09 per share prior to the reverse stock split) and acquire all of T-Mobile's capital stock by issuing to Deutsche Telekom 74% of MetroPCS' common stock on a pro forma basis. Deutsche Telekom has also agreed to roll its existing intercompany debt into new $15 billion senior unsecured notes of the combined company, provide the combined company with a $500 million unsecured revolving credit facility and provide a $5.5 billion backstop commitment for certain MetroPCS third-party financing transactions.
The combined company will be a stronger competitor and will be well-positioned to drive future growth. Based on analyst consensus estimates for 2012, the combined company is expected to have approximately 42.5 million subscribers, $24.8 billion of revenue, $6.3 billion of adjusted EBITDA, $4.2 billion of capital expenditures and $2.1 billion of free cash flow (defined as EBITDA less capital expenditures) in 2012.
The stock has a $32 price target from the Point and Figure chart. There have been 21 insider sell transactions and there have not been any insider buy transactions since February 2012. The stock is trading at a P/E ratio of 13.90 and a forward P/E ratio of 16.91. The company has a book value of $8.59 per share. I am not interested in shorting the stock before the $32 price target is hit.
4. Smart Balance (SMBL) is committed to providing superior tasting, solution-driven products in every category it enters. The company's health and wellness platform consists of brands that target specific consumer needs: Glutino and Udi's for gluten-free diets; Earth Balance for plant-based diets; Smart Balance for heart healthier diets; and Bestlife for weight management.
Adage Capital Partners Gp sold 367,000 shares on October 5-8 and currently holds 6,976,302 shares of Smart Balance. Smart Balance has 59,195,007 shares outstanding which makes Adage Capital Partners a 11.8% owner of Smart Balance.
The company reported the second-quarter financial results on August 2 with the following highlights:
|Net income||$0.5 million|
For 2012, the company expects net sales in the range of $360 million to $370 million, gross margin in the 42% to 44% range, and cash operating income in the $53 million to $55 million range. This compares to its previous 2012 outlook of sales in the $320 million to $330 million range, gross margin in the 42% to 44% range, and cash operating income in the $46 million to $48 million range.
For 2013 the company expects sales to be in the range of $440 million to $450 million and cash operating income to be in the range of $70 million to $75 million.
The stock has met its $12.25 price target from the Point and Figure chart. There has been only one insider sell transaction and one insider buy transaction this year. The stock is trading at a P/E ratio of 100.58 and a forward P/E ratio of 35.50. The company has a book value of $5.58 per share. I have a neutral bias for the stock currently.
5. Brown-Forman Corporation (BF.A) has enriched the experience of life by responsibly building fine quality beverage alcohol brands, including Jack Daniel's Tennessee Whiskey, Southern Comfort, Finlandia, Jack Daniel's & Cola, Canadian Mist, Korbel, Gentleman Jack, el Jimador, Herradura, Sonoma-Cutrer, Chambord, New Mix, Tuaca, and Woodford Reserve. Brown-Forman's brands are supported by nearly 4,000 employees and sold in approximately 160 countries worldwide.
Christina Brown sold 62,270 shares on October 4-5. Christina Brown controls more than 10% of the company.
The company reported the financial results for its first-quarter of fiscal 2013 (ending July 31) on August 29 with the following highlights:
|Net income||$118.1 million|
At this early stage in the fiscal year, the company is confirming its fiscal 2013 earnings outlook of $2.40 to $2.67, adjusted for the three-for-two stock split. First-quarter reported results benefited significantly from buy-ins in advance of price increases. Accordingly, this outlook assumes second-quarter results will likely reflect the impact of the marketplace working through the first quarter buy-ins. This outlook also includes anticipated negative impacts from foreign exchange of $0.05 per share and commodity price increases of $0.03 per share. At this point, for fiscal 2013 the company continues to expect high single-digit growth in underlying sales and operating income.
The stock has a $104 price target from the Point and Figure chart. There have been 33 insider sell transactions and two insider buy transactions this year. The stock is trading at a P/E ratio of 25.50 currently. I am not interested in shorting the stock before the $104 price target is hit.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.