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Insider Weekends – June 24, 2011

 June 26, 2011 01:35 AM
 


Welcome to edition fifty five of Insider Weekends. Insider buying increased with insiders purchasing $69.72 million of their stock last week when compared to $43.2 million in the week prior. Selling on the other hand decreased with insiders selling $550.9 million worth of stock compared to $1.13 billion in the week prior.

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 dropped to 7.9. In other words, insiders sold nearly 8 times as much stock as they purchased. The Sell/Buy ratio this week compares favorably with the week prior when the ratio stood at 26.12. We are calculating an adjusted ratio by removing transactions by funds and companies and trying as best as possible only to retain information about insiders and 10% owners who are not funds or companies.

[Related -Guess?, Inc. (GES) Q3 Earnings Preview: November Is A Perfect Fit]

Insider Sell Buy Ratio June 24,2011

Note: As mentioned in the first post in this series Introduction to Insider Weekends, 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.

[Related -Intuit Inc. (INTU) Q1 Earnings Preview: What To Watch?]

Notable Insider Buys:

1. Titanium Metals Corporation (TIE): $17.28

Chairman of the Board Harold C. Simmons acquired 2,461,428 shares of this titanium metal producer, paying $16.70 per share for a total amount of $41.1 million. These shares were purchased indirectly by TIMET Finance Management Company.

As some of you might recall, Mr. Simmons has been continuously buying shares of Valhi (VHI) for well over a year and the stock has nearly doubled over the last three months rising from $24.87 to $46.25.

In one of the daily reports published on August 23, 2010, I wrote the following about Mr. Simmons purchase of Valhi, "Mr. Simmons is also Chairman of the Board of NL Industries (NL) and Kronos (KRO). He purchased shares of both companies in July and both those stocks saw rapid price appreciation in the following weeks. Mr. Simmons has also been buying Valhi stock since March but this has been his biggest purchase this year."

You can view the list of recent insider transactions for Titanium Metals Corporation here.

P/E: 33.62Forward P/E: 18.38Industry P/E: 13.88
P/S: 3.53Price/Book: 2.51EV/EBITDA: 15.65
Market Cap: $3.11BAvg. Daily Volume: 2,457,81052 Week Range: $16.03 – $22.93

2. Equity One Inc. (EQY): $18.15

Chairman Chaim Katzman acquired 289,232 shares of this shopping centers REIT, paying $17.87 per share for a total amount of $5.2 million.

These shares were purchased indirectly by MGN USA, an affiliate of Equity One's largest stockholder, Gazit-Globe, Ltd. MGN USA also participated in a recent offering by Equity One, where it purchased 1 million shares. Equity One sports a yield of 4.9%, which is higher than the 3.45% average yield of shopping centers REITs as of May 2011.

You can view the list of recent insider transactions for Equity One Inc. here.

P/E: 22.55Forward P/E: 15.78Industry P/E: N/A
P/S: 6.49Price/Book: 1.37EV/EBITDA: 20.08
Market Cap: $1.97BAvg. Daily Volume: 624,98352 Week Range: $14.58 – $20.09

3. Valhi, Inc. (VHI): $46.25

Chairman of the Board Harold C. Simmons acquired 71,376 shares of this chemicals and component products company, paying $45.76 per share for a total amount of $3.3 million. These shares were purchased indirectly by TIMET Finance Management Company.

You can view the list of recent insider transactions for Valhi, Inc. here.

P/E: 70.94Forward P/E: N/AIndustry P/E: 16.87
P/S: 3.06Price/Book: N/AEV/EBITDA: 24.54
Market Cap: $5.23BAvg. Daily Volume: 34,89252 Week Range: $11.03 – $50.21

4. Navistar International Corp. (NAV): $53.33

Director Eugenio Clariond acquired 56,000 shares of this truck and diesel engines manufacturer, paying $53.97 per share for a total amount of $3.02 million. These shares were purchased indirectly through a trust.

Mr. Clariond has been a director of Navistar since 2002. This is his first purchase since last June when he picked up 35,500 shares at an average price of $56.45. The stock has tumbled recently along with the rest of the market. The company expects to post earnings of between $5.50 to $6 per share for full fiscal 2011, which ends in October. Even if the company meets the low end of its guidance, the stock appears to be cheap. It would be nice to see confirmation through additional insider purchases as all other insider transactions over the last six months have been direct or options related sales as you can see from this page.

P/E: 17.68Forward P/E: 7.26Industry P/E: 15.67
P/S: 0.31Price/Book: N/AEV/EBITDA: 9.83
Market Cap: $3.88BAvg. Daily Volume: 1,328,26052 Week Range: $40.58 – $71.49

5. Pandora Media, Inc. Common Stoc (P): $15.37

Director Barry Mccarthy acquired 88,085 shares of this internet radio company, paying $13.04 per share for a total amount of $1.15 million. These shares were purchased indirectly by a trust.

It was very interesting to see a director of the company purchase shares on the open market in such a short time after the company went public. Pandora has been the first app I installed on every smart phone I have owned and you can read my gushing review of their iPhone app here. Pandora adds a new user every second and currently has over 90 million registered users.

I decided to skip the IPO primarily because I don't normally invest in IPOs and because Pandora was priced too rich for my blood at 19 times sales.

You can view the list of recent insider transactions for Pandora Media, Inc. Common Stoc here.

P/E: N/AForward P/E: N/AIndustry P/E: N/A
P/S: 13.37Price/Book: 19.64EV/EBITDA: -3.99
Market Cap: $2.46BAvg. Daily Volume: 9,201,66052 Week Range: $12.16 – $26

You can view the full list of purchases from this Insider Buying page.

Notable Insider Sales:

1. Guess? Inc. (GES): $41.44

Chairman of the Board Maurice Marciano sold 965,850 shares of this apparel and accessories chain for $42.20, generating $40.8 million from the sale. 125,850 of these shares weresold as a result of exercising options immediately prior to the sale.

You can view the list of recent insider transactions for Guess? Inc. here.

P/E: 13.67Forward P/E: 10.49Industry P/E: 16.08
P/S: 1.53Price/Book: 3.47EV/EBITDA: 7.09
Market Cap: $3.84BAvg. Daily Volume: 1,733,27052 Week Range: $30.54 – $51.53

2. Intuit Inc. (INTU): $50.5

Director David H. Batchelder sold 227,827 shares of this business and tax software company for $49.55, generating $11.3 million from the sale. These shares were sold indirectly through limited partnerships.

You can view the list of recent insider transactions for Intuit Inc. here.

P/E: 25.15Forward P/E: 17.78Industry P/E: 27.05
P/S: 4.06Price/Book: 5.46EV/EBITDA: 11.76
Market Cap: $15.35BAvg. Daily Volume: 2,402,66052 Week Range: $34 – $56.46

3. Aaron's, Inc. (AAN): $27

Chairman R Charles Loudermilk sold 417,655 shares of this consumer electronics and household appliances retailer for $26.26, generating $10.9 million from the sale.

You can view the list of recent insider transactions for Aaron's, Inc. here.

P/E: 17.56Forward P/E: 13.71Industry P/E: 14.58
P/S: 1.14Price/Book: 2.14EV/EBITDA: N/A
Market Cap: $2.16BAvg. Daily Volume: 605,96952 Week Range: $16.16 – $24.32

4. Avalonbay Communities Inc. (AVB): $127.5

Shares of this apartment REIT were were sold by 4 insiders:

  • President Timothy J. Naughton sold 40,054 shares for $131.27, generating $5.3 million from the sale. 28,755 of these shares were sold as a result of exercising options immediately prior to the sale.
  • CEO Bryce Blair sold 29,155 shares for $130.12, generating $3.8 million from the sale. These shares were sold as a result of exercising options immediately prior to the sale.
  • SVP-General Counsel Edward M. Schulman sold 3,500 shares for $131.27, generating $459,443 from the sale.
  • Executive Vice President Sean J. Breslin sold 1,500 shares for $132.30, generating $198,450 from the sale.

You can view the list of recent insider transactions for Avalonbay Communities Inc. here.

P/E: 82.15Forward P/E: 23.18Industry P/E: 26.31
P/S: 12.16Price/Book: 3.26EV/EBITDA: 28.49
Market Cap: $11.13BAvg. Daily Volume: 721,36852 Week Range: $88.83 – $130

5. ICO Global Communications (ICOG): $3.23

Chief IP Officer, VP Joseph Kent Siino sold 1,860,000 shares of this developer of satellites for $2.81, generating $5.2 million from the sale.

You can view the list of recent insider transactions for ICO Global Communications here.

P/E: 2.69Forward P/E: N/AIndustry P/E: 12.85
P/S: N/APrice/Book: 2.58EV/EBITDA: -37.95
Market Cap: $814.11MAvg. Daily Volume: 403,31852 Week Range: $1.2 – $3.26

You can view the full list of sales from this Insider Sales page.

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