Insider buying decreased significantly last week with insiders purchasing $40.96 million of stock compared to $106.41 million in the week prior. Selling also decreased with insiders selling $1.63 billion of stock last week compared to $1.72 billion in the week prior. With companies entering the traditional quiet period before the end of the third quarter, insider activity is likely to remain muted over the next few weeks.
Sell/Buy Ratio: The insider Sell/Buy ratio is calculated by dividing the total insider sales in a given week by total insider purchases that week. The adjusted ratio for last week went up to 39.79. In other words, insiders sold almost 40 times as much stock as they purchased. The Sell/Buy ratio this week compares unfavorably with the prior week when the ratio stood at 16.12.
Insider Sector Heat Map September 21, 2018 (Source: InsideArbitrage.com database)
Note: As mentioned in the first post in this series, certain industries have their preferred metrics such as same-store sales for retailers, funds from operations (FFO) for REITs, and revenue per available room (RevPAR) for hotels that provide a better basis for comparison than simple valuation metrics. However, metrics like Price/Earnings, Price/Sales, and Enterprise Value/EBITDA included below should provide a good starting point for analyzing the majority of stocks.
Notable Insider Buys:
1. Bausch Health Companies Inc. (NYSE:BHC): $24.92
Shares of this pharmaceutical company were acquired by 3 insiders:
- Director Richard DeSchutter acquired 125,000 shares, paying $23.96 per share for a total amount of $2.99 million. Mr. Richard increased his stake by 92.78% to 259,727 shares with this purchase.
- Chairman & CEO Joseph C. Papa acquired 30,000 shares, paying $22.32 per share for a total amount of $669,600. Mr. Papa increased his stake by 4.78% to 657,077 shares with this purchase.
- EVP and CFO Paul Herendeen acquired 10,000 shares, paying $22.61 per share for a total amount of $226,100. Mr. Herendeen increased his stake by 4.83% to 216,866 shares with this purchase.
Instead of spinning off its Bausch & Lomb division and paying down debt, Valeant Pharmaceuticals instead chose to rebrand itself and picked the name Bausch Health Companies in July 2018. While Mr. DeSchutter's purchase was a regular direct purchase, both the CEO and CFO received matching restricted stock units in connection with their open market purchases. The CEO received 30,000 shares and the CFO received 10,000 shares that will vest over a period of three years.
|P/E: N/A||Forward P/E: N/A||Industry P/E: 30.48|
|P/S: 1.02||Price/Book: 2.51||EV/EBITDA: 9.57|
|Market Cap: $8.71B||Avg. Daily Volume: 4,469,070||52-Week Range: $20.38 - $25.35|
2. Molina Healthcare, Inc. (NYSE:MOH): $152.72
Executive Vice President James Woys acquired 25,000 shares of this health care plans company, paying $148.79 per share for a total amount of $3.72 million. Mr. Woys increased his stake by 531.58% to 29,703 shares with this purchase.
|P/E: N/A||Forward P/E: 22.39||Industry P/E: 23.66|
|P/S: 0.49||Price/Book: 5.71||EV/EBITDA: 6.21|
|Market Cap: $9.43B||Avg. Daily Volume: 962,469||52-Week Range: $58.66 - $153.83|
3. Odonate Therapeutics, Inc. (NASDAQ:ODT): $21.01
Chief Executive Officer Kevin C. Tang acquired 90,000 shares of this biotech company, paying $19.55 per share for a total amount of $1.76 million. These shares were purchased indirectly by Tang Capital Partners.
|P/E: N/A||Forward P/E: -6.59||Industry P/E: 30.48|
|P/S: N/A||Price/Book: 3.28||EV/EBITDA: -5.38|
|Market Cap: $564.99M||Avg. Daily Volume: 37,259||52-Week Range: $15.15 - $32|
4. Salesforce.com, Inc. (NYSE:CRM): $155.52
Director Susan Wojcicki acquired 6,000 shares of this software application company, paying $157.57 per share for a total amount of $945,441. Mr. Wojcicki increased his stake by 7.12% to 90,320 shares with this purchase.
We wrote the following after Ms. Wojcicki's purchase in April:
Considering most other insiders of salesforce.com are actively selling stock, it is hard to read much into Ms. Wojcicki's purchase but she has been buying once a month since the start of this year. This purchase was also noticed by Barron's and they published a short article about Ms. Wojcicki's purchases of Salesforce.com on Friday.
|P/E: 162.169||Forward P/E: 56.967||Industry P/E: 26.52|
|P/S: 9.97896||Price/Book: 8.69896||EV/EBITDA: 108.957|
|Market Cap: $117.68B||Avg. Daily Volume: 4,880,558||52-Week Range: $92.11 - $158.79|
5. NGL Energy Partners LP (NYSE:NGL): $11.3
Director John T. Raymond acquired 50,000 shares of this oil & gas refining & marketing company, paying $11.04 per share for a total amount of $551,920.
|P/E: N/A||Forward P/E: 17.38||Industry P/E: 20.71|
|P/S: 0.07||Price/Book: 0.79||EV/EBITDA: 13.49|
|Market Cap: $1.38B||Avg. Daily Volume: 911,995||52-Week Range: $10 - $17.65|
You can view the full list of purchases from this Insider Buying page.
Notable Insider Sales:
1. Walmart Inc. (NYSE:WMT): $95.9
Director Robson S. Walton sold 1,131,360 shares of Walmart for $95.30, generating $107.82 million from the sale. These shares were sold indirectly by a trust.
|P/E: 54.86||Forward P/E: 19.94||Industry P/E: 77.22|
|P/S: 0.55||Price/Book: 3.97||EV/EBITDA: 9.74|
|Market Cap: $280.87B||Avg. Daily Volume: 7,493,717||52-Week Range: $77.5 - $109.98|
2. Chubb Limited (NYSE:CB): $139.86
Chairman & CEO Evan G. Greenberg sold 227,994 shares of this insurance company for $140.29, generating $31.99 million from the sale. 166,684 of these shares were sold as a result of exercising options immediately prior to the sale.
|P/E: 17.11||Forward P/E: 12.44||Industry P/E: 35.48|
|P/S: 1.96||Price/Book: 1.27||EV/EBITDA: 17.19|
|Market Cap: $64.79B||Avg. Daily Volume: 1,491,741||52-Week Range: $123.96 - $157.5|
3. Roku, Inc. (NASDAQ:ROKU): $72.45
CEO and Chairman BOD Anthony J. Wood sold 421,549 shares of this pay-TV company for $70.89, generating $29,884,450 from the sale. 294,000 of these shares were sold as a result of exercising options immediately prior to the sale.
|P/E: N/A||Forward P/E: -1811.25||Industry P/E: 39.09|
|P/S: 12.67||Price/Book: 35.94||EV/EBITDA: 32044.1|
|Market Cap: $7.69B||Avg. Daily Volume: 7,888,982||52-Week Range: $15.75 - $74.25|
4. Salesforce.com, Inc.: $155.52
Shares of this software application company were sold by 6 insiders:
- Chief Accounting Officer Joe Allanson sold 104,277 shares for $158.33, generating $16,509,914 from the sale. These shares were sold as a result of exercising options immediately prior to the sale.
- Chairman of the Board & co-CEO Marc Benioff sold 35,000 shares for $155.88, generating $5,455,654 from the sale.
- Director Sanford Robertson sold 30,000 shares for $157.96, generating $4,738,851 from the sale.
- Co-Founder and CTO Parker Harris sold 5,711 shares for $156.79, generating $895,417 from the sale. These shares were sold as a result of exercising options immediately prior to the sale.
- Pres., Legal & General Counsel Amy E. Weaver sold 5,325 shares for $154.86, generating $824,630 from the sale. These shares were sold as a result of exercising options immediately prior to the sale.
- Pres. and Chief People Officer Cynthia G. Robbins sold 1,589 shares for $158.00, generating $251,062 from the sale.
|P/E: 162.17||Forward P/E: 56.97||Industry P/E: 26.52|
|P/S: 9.98||Price/Book: 8.69||EV/EBITDA: 108.96|
|Market Cap: $117.68B||Avg. Daily Volume: 4,880,558||52-Week Range: $92.11 - $158.79|
5. CarGurus, Inc. (NASDAQ:CARG): $51.62
Shares of this online auto shopping company were sold by 3 insiders:
- Director Anastasios Parafestas sold 360,000 shares for $51.99, generating $18.72 million from the sale. These shares were sold indirectly by various trusts and entities.
- Chief Technology Officer Oliver Ian Chrzan sold 30,000 shares for $51.84, generating $1.56 million from the sale.
- Sr. VP, GC and Secretary Kathleen Bender Patton sold 8,120 shares for $51.67, generating $419,560 from the sale.
|P/E: 125.59||Forward P/E: 166.52||Industry P/E: 71.59|
|P/S: 14.77||Price/Book: 36.09||EV/EBITDA: 435.24|
|Market Cap: $5.65B||Avg. Daily Volume: 799,475||52-Week Range: $25.85 - $56.17|
You can view the full list of sales from this Insider Sales page.
Disclaimer: Please do your own due diligence before buying or selling any securities mentioned in this article. We do not warrant the completeness or accuracy of the content or data provided in this article.
Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.
I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.