Analyzing Thursday And Friday's Noteworthy Insider Trades

by: GuruFundPicks

We present here two noteworthy insider buys and ten noteworthy insider sells from Thursday and Friday's (April 19th and 20th, 2012) over 320 separate SEC Form 4 (insider trading) filings, as part of our daily and weekly coverage of insider trades. 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 (for more info on how to interpret insider trades, please refer to the end of this article):

Rite Aid Corp. (NYSE:RAD): RAD operates approximately 4,700 retail drugstores 31 states and the District of Columbia, with a strong presence on both the East and West coasts, offering prescription drugs, convenience products and cosmetics. On Thursday, Jean Coutu Group, a Quebec-based Canadian drugstore chain with more than 360 franchised locations, and an insider by virtue of its 10% ownership in the company, filed SEC Form 4 indicating that it sold 11.2 million shares for $17.2 million, decreasing its ownership of RAD shares to 223.2 million or 24.8% of outstanding shares after the sale.

RAD shares have traded lower, down over 20% at the lows on Friday, ever since the company reported missing analyst earnings estimates in its Q4 (ending February) report released last Thursday. However, the company beat estimates for each of the previous three quarters, and also projected FY 2013 revenues and earnings in-line in its most recent Q4 report. Furthermore, RAD is slowly turning the corner toward profitability, with losses down from a peak of 59c in 2011 to 43c in 2012 and projected to fall even further to 12c by 2014. Earlier, the shares surged last month on the back of rumors that the company might be an acquisition target of rival Walgreen Company (WAG) for between $2 to $4 per share, well above Friday's closing price in the $1.50s. Technically, the stock has formed a good base for the last three year, trading between $1 and $2, and looks ready for a rally if it breaks out on good news above $2.

US Bancorp (NYSE:USB): USB is a super-regional financial services holding company, operating full-service branch offices and ATMs, and providing a full range of banking and financial services including brokerage, insurance, investment, mortgage, trust and payment services to individuals, institutions and corporations. On Friday, three insiders filed SEC Forms 4 indicating that they exercised options and sold the resulting 0.21 million shares for $6.8 million, with EVP Lee Mitau and Vice Chairman Richard Hartnack selling a net 95,200 and 85,096 of those shares respectively. In comparison, insiders sold 0.55 million shares in the past year.

USB shares are up over 15% YTD, compared to the flattish performance for the average regional banking stock. In the most recent Q1 announced last Tuesday, it beat analyst earnings (67c v/s 64c) and revenue estimates, and the shares trade at 10-11 forward P/E and 1.8 P/B compared to averages of 10.2 and 1.1 for its peers among major regional banks.

Curis Inc. (NASDAQ:CRIS): CRIS is a development stage biotech company focused on the development of targeted cancer therapies that modulate signaling pathways controlling the repair and regeneration of tissues. On Friday, COO & CFO Michael Gray filed SEC Form 4 indicating that he exercised options and sold the resulting 42,844 shares for $0.21 million, pursuant to a 10b5-1 plan, and ending with 86,613 shares after the sale. In comparison, insiders sold 0.15 million shares in the past year.

CRIS shares currently trade within striking range of 10-year highs, at 9.3 P/B compared to the 3.7 average for its peers in the biotech group. A number of brokers, including Piper Jaffray, Brean Murray, Summer Street Research and others, have come out in support of the stock recently, after at the end of January its Erivedge Capsule (vismodegib) product gained FDA approval for the treatment of advanced basal cell carcinoma.

On top of these, some additional large insider sales on Thursday and Friday include:

  • a $10.3 million sale by Chairman & CEO James Wright at Tractor Supply Co. (NASDAQ:TSCO), a specialty retailer that operates retail farm and ranch stores in the U.S.;
  • a $4.8 million sale by Chairman & CEO Frank Coyne at leading provider of risk assessment solutions Verisk Analytics (NASDAQ:VRSK);
  • a $2.7 million sale by SVP Jan Spencer at leading consumer products company Kimberley-Clark Corp. (NYSE:KMB);
  • a $1.9 million sale by SVP Raal Roos at beauty supply store chain operator Sally Beauty Holdings (NYSE:SBH);
  • a $1.9 million sale by Director Charles Baker at Regeneron Pharmaceutical (NASDAQ:REGN), a developer of medicines for the treatment of serious medical conditions, with two products, ARCALYST and EYLEA, on the market, and additional in development to treat inflammatory conditions, allergic and immune conditions, and cancer; and
  • a $1.2 million sale by President Barbara Rentler at Ross Stores Inc. (NASDAQ:ROST), that operates 1,037 Ross Dress for Less stores, the largest off-price apparel and home fashion retail chain in the U.S. and Guam, and it operates 88 dd's Discounts stores in seven states that feature a more moderately-priced assortment of first-quality, in-season, name brand apparel, accessories, footwear and home fashion for the entire family.

Furthermore, insiders also reported noteworthy buys on Thursday and Friday in:

  • EV Energy Partners (NASDAQ:EVEP), a MLP engaged in the acquisition, development and production of oil & natural gas properties in the continental U.S., in which President & CEO Mark Houser purchased 1,500 shares for $93,960, in addition to another 12,000 shares purchased by insiders earlier this month, and in comparison to just an additional 2,300 shares purchased by insiders in the past year; and
  • Keryx Biopharmaceuticals (NASDAQ:KERX), a developer of novel pharmaceutical products to treat cancer, renal disease and other life-threatening diseases, in which CEO Ron Bentsur purchased 19,100 shares for $24,696, in comparison to 94,100 shares purchased by insiders in the past year.

Credit: Fundamental data in this article were based on SEC filings, 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.

Disclaimer: Material presented here is for informational purposes only. Nothing in this article should be taken as a solicitation to purchase or sell securities. Before buying or selling any stock you should do your own research and reach your own conclusion. Further, these are our 'opinions' and we may be wrong. We may have positions in securities mentioned in this article. You should take this into consideration before acting on any advice given in this article. If this makes you uncomfortable, then do not listen to our thoughts and opinions. The contents of this article do not take into consideration your individual investment objectives so consult with your own financial adviser before making an investment decision. Investing includes certain risks including loss of principal.

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