I screened with Open Insider for insider sell transactions filed on October 11. 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. Primerica (PRI) is a leading distributor of financial products to middle-income families in North America. Primerica representatives educate their Main Street clients about how to better prepare for a more secure financial future by assessing their needs and providing appropriate solutions through term life insurance which Primerica underwrites, and mutual funds, annuities and other financial products, which Primerica distributes primarily on behalf of third parties. In addition, Primerica provides an entrepreneurial full or part-time business opportunity for individuals seeking to earn income by distributing the company's financial products. Primerica insures more than 4.3 million lives and approximately 2 million clients maintain investment accounts with Primerica.
Warburg Pincus Private Equity X sold 2,087,682 shares on October 10. Primerica announced on October 4 that it has entered into an agreement to repurchase 2,087,682 shares of Primerica common stock beneficially owned by Warburg Pincus Private Equity X and Warburg Pincus X Partners at a purchase price of $28.74 per share. The purchase price was determined based on the closing price of Primerica common stock on October 3, 2012. Following the repurchase transaction, Warburg Pincus will own approximately 15.0% of Primerica's outstanding common stock and approximately 20.7% taking into account Warburg Pincus' warrants to purchase Primerica common stock.
This capital deployment completes the $75 million repurchase program Primerica began executing in the third quarter of 2012. Primerica repurchased 488,214 shares of common stock for $14.3 million through an open market purchase program prior to this transaction.
The company reported the second-quarter financial results on August 7 with the following highlights:
|Net income||$46.2 million|
The stock has a $52.5 price target from the Point and Figure chart. There have been 26 insider sell transactions and there has been one insider buy transaction this year. The stock is trading at a P/E ratio of 11.77 and a forward P/E ratio of 9.47. The company has a book value of $21.32 per share. I am not interested in shorting the stock before the $52.5 price target is hit.
2. Infoblox (BLOX) delivers Automated Network Control, the fundamental technology that connects end users, devices and networks. Mobile devices, virtualization and cloud all demand a high performing, scalable network, which is pushing an overtaxed Internet infrastructure toward a massive transformation. Infoblox's Automated Network Control is a real time, non-stop, automated solution that fits today's complex networks and scales with them to enable that transformation. Infoblox helps more than 5,400 end customers take the burden of complex network control out of human hands, reduce costs, and increase accuracy and uptime.
- Thomas Banahan sold 1,342,273 shares on October 11 pursuant to a secondary offering. The shares were sold by Tenaya Capital. Thomas Banahan has served as a member of Infoblox's board of directors since February 2004. Since 1999, he has served in several roles at Tenaya Capital (formerly Lehman Brothers Venture Capital), a venture capital firm, including most recently as managing director since February 2009.
- Robert Thomas sold 195,000 shares on October 11 pursuant to a secondary offering. Robert Thomas has served as president and chief executive officer and as a member of Infoblox's board of directors since September 2004.
- Sohail Parekh sold 60,000 shares on October 11 pursuant to a secondary offering. Sohail Parekh is Executive Vice President, Engineering.
- Steve Nye sold 50,000 shares on October 11 pursuant to a secondary offering. Steve Nye is Executive Vice President of Product Strategy & Corporate Development.
- Remo Canessa sold 94,000 shares on October 11 pursuant to a secondary offering. Remo Canessa is Chief Financial Officer of the company.
- Christopher Andrews sold 50,000 shares on October 11 pursuant to a secondary offering. Christopher Andrews is Executive Vice President, Worldwide Field Operations.
The company reported the full fiscal year 2012, which ended on July 31, financial results on September 6 with the following highlights:
|Net loss||$8.2 million|
For the first fiscal quarter ending October 31, 2012, the company currently expects:
- Total net revenue in the range of $45 million to $46.5 million;
- Non-GAAP gross margin to be approximately 76%;
- Non-GAAP operating margin in the range of break-even to slightly profitable; and
- Non-GAAP EPS to be break-even
For the fiscal year ending July 31, 2013, the company currently expects:
- Total net revenue in the range of $195 million to $202 million;
- Non-GAAP operating margin in the range of 1% to 3%; and
- Non-GAAP EPS in the range of $0.04 to $0.07
The company had an Initial Public Offering in April 2012. There have been six insider sell transactions and there have not been any insider buy transaction since the Initial Public Offering. The stock is trading at a forward P/E ratio of 68.97. I have a neutral bias for the stock currently.
3. 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.
Lawrence Page sold 20,835 shares on October 11, 41,666 shares on October 9-10, 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. Lawrence Page currently holds 25,568,592 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.
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.
The company reported the second-quarter financial results on July 19 with the following highlights:
|Net income||$2.8 billion|
The stock has a bearish $705 price target from the Point and Figure chart. 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 P/E ratio of 22.28 and a forward P/E ratio of 15.26. The stock is currently trading very close to its all time high level. There is an opportunity for a short entry with the $705 price target and a stop loss at $775.
4. 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 530,130 shares on October 9-11, 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 23 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 12.93 and a forward P/E ratio of 15.73. 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.
5. Mattress Firm Holding Corporation (MFRM) is one of the nation's leading mattress specialty retailers, offering a broad selection of both traditional and specialty mattresses from leading manufacturers, bedding accessories and related products.
- Stephen Stagner sold 152,000 shares on October 10 pursuant to a public offering. Stephen Stagner became the company's Chief Operating Officer in January 2005 as a result of the merger between Mattress Firm and his former Mattress Firm franchise, Elite Management Team.
- Kenneth Murphy III sold 24,729 shares on October 10 pursuant to a public offering. Kenneth Murphy III became the company's National Vice President of Sales in September 2010 after holding various positions within Mattress Firm since 2005.
- George McGill sold 10,000 shares on October 10 pursuant to a public offering. George McGill was promoted to Vice President of Field Operations in July 2009 from his previous position as Vice President of Operations, which he held from January 2007, until his promotion.
- Bruce Levy sold 4,000 shares on October 10 pursuant to a public offering. Bruce Levy became Vice President of Real Estate and Construction in January 2009 to focus on continuing the company's nationwide expansion.
- Karrie Forbes sold 20,820 shares on October 10 pursuant to a public offering. Karrie Forbes became Vice President of Marketing in January 2008, responsible for the strategic direction of the marketing, advertising and communication.
- James Black sold 55,000 shares on October 10 pursuant to a public offering. James Black became Executive Vice President and Chief Financial Officer in September 2000.
The company reported the second-quarter financial results on September 6 with the following highlights:
|Net income||$3.6 million|
The company's guidance for the full fiscal year ending January 29, 2013 is as follows:
For the third fiscal quarter ending October 30, 2012, the company expects net sales in a range from $270 million to $275 million, and EPS in a range from $0.38 to $0.41.
The stock has a $44 price target from the Point and Figure chart. There have been six insider sell transactions and there has been one insider buy transaction this year. The stock is trading at a P/E ratio of 21.52 and a forward P/E ratio of 14.84. I am not interested in shorting the stock before the $44 price target is hit.
Disclosure: I have no positions in any stocks mentioned, but may initiate a short position in GOOG over the next 72 hours.