Often, if company insiders are seen selling, then there's a
positive chance that their company's stock has reached its peak,
or at least on its way there.
GuruFocus once wrote:
"Insiders as a whole are smart investors of their own companies.
They tend to sell more when the market is high, and buy more when
the market is low. The aggregated activities of Insiders can
serve as a good indicator to locate the market bottoms."
Based on the
Insider research series
GuruFocus performed in 2010, the study concluded that insider
trades have a direct correlation with the ups and downs of the
Below are some insider trading highlights for this week.
eBay Inc. (
Mark Carges is eBay's chief technology officer and senior vice
president of global products. He sold 200,000 shares on Jan. 23,
at $53.31 per share. The transaction made him more than $10.7
Ebay is an online buy-and-sell hub, that serves as a global
commerce platform. Founded in 1995 in San Jose, Calif., eBay
serves as the ultimate online marketplace, hosting transactions
through PayPal to securely transfer money from buyer to seller.
Trading almost near its 10-year high, eBay has soared in market
value over the years. In the last three years, it appreciated
134.05 percent. In the last year, it gained 72.74 percent.
For the full 2012 year, eBay's revenue reported a 21 percent
increase compared to 2011. The company's commerce volume grew 18
percent, as its worth reached $175 billion. It also increased in
non-GAAP earnings per diluted share, driven by double digit user
growth, strong gains in mobile adoption and heightened
acceleration of the company's marketplace business. Overall, the
company exceeded its fourth quarter expectations.
As seen in the above chart, eBay's insider trades are colored
with sales, relative to its rising value.
This solid performance has locked in confidence for much of
eBay's insiders. In the same week, three other company execs sold
chunks of their stake in the company, making millions.
President and CEO John Donahoe sold 250,000 shares on Jan. 22,
banking a total of $13.4 million. On the same day Alan Marks,
senior vice president of corporate communications sold 31,237,
which returned $1.7 million, while Robert Holmes Swan, CFO and
finance senior vice president, sold 100,000 shares, valued at
EBay is ranked 3 stars in Business Predictability on GuruFocus.
It is currently priced at $56.49, up almost 3 percent in mid-day
trading. Gurus who own large amounts of its outstanding shares
Dodge & Cox
To view more, visit eBay's Insider Activity.
Huntington Bancshares Inc. (
President, CEO and Chairman Stephen Steinour bought 40,000 shares
of Huntington Bancshares Inc. on Jan. 23. The transaction cost
him $281,600 at $7.04 per share. It placed his share total to 2.3
Headquartered in Ohio, Huntington Bancshares is the $56 billion
bank holding company of Huntington National Bank, which provides
a full-service commercial, small business and consumer banking
services, among others. Huntington's six-state banking franchise
also reaches Michigan, Pennsylvania, Indiana, West Virginia and
Steinour's buy is the company's first insider trade of the year,
after activity halted throughout the December holiday season.
In 2012, Huntington's return on average assets slightly increased
by a less than 1 percent, its tangible book value per common
share increased by 12 percent, and a 25 percent decline in
nonaccrual loans, according to its fourth quarter earnings
Huntington also announced a dividend payout of $0.04 per common
share, distributed on April 1.
As far as outlook for 2013, Steinour commented:
"We expect to continue seeing the strong growth of the Midwest
economy relative to the broader United States. However, business
sentiment continues to be negatively influenced by the
uncertainty in Washington and its direct impact on the U.S.
economy. We remain optimistic that when solutions are in place,
the strength of the Midwest and the soundness of our strategy
will continue to drive growth."
Steinour has increased his stake in Huntington almost 20 times
since 2009. His holding today totals 2.3 million shares.
With one star in Business Predictability, Huntington trades at
$9.97. Though its two Severe Warning Signs denote a decline in
per share revenue and inventory build-up, its dividend yield of
2.59 percent is close to a two-year high. Gurus who hold the
stock include Arnold Schneider, Diamond Hill Capital and Jim
To view more, visit Huntington Bancshares' Insider Activity.
Cardinal Health Inc. (
Cardinal Health is an Ohio-based health care service company that
offers cost-effective health care and equipment to more than
60,000 locations. It additionally leads in the manufacturing of
gloves, surgical apparel and fluid management products.
There were three insiders who sold some shares of Cardinal Health
on Jan. 23.
CEO of Cardinal's Pharmaceutical Segment Michael Kaufmann made
$2.6 million from getting rid of 58,362 shares at $44.95 per
Chief Legal and Compliance Officer Craig Morford made $2.1
million from selling 47,274 shares at $45 per share.
Lastly, Executive Vice President, General Counsel and Secretary
Steve Falk sold 39,080 shares, also at $45 a piece, making about
$1.8 million on the sale.
In the past five years, Cardinal Health has gained 9.58 percent
in market value. With its price bobbing throughout 2012,
Cardinal's stock managed to go up 6.88 percent in the last year.
Its lowest at $37 in September, Cardinal now trades at $44.93 per
On Jan. 15, Cardinal paid a quarterly dividend of $1.10 per share
to its stakeholders. This rate was a 10.5 percent increase in
dividend compared to 2012.
Cardinal is ranked 1 star in Business Predictability on
GuruFocus. While its price is close to a three-year high, its P/B
ratio is close to a three-year low and P/S ratio is close to a
two year low. Gurus who hold the stock include Edward Owens,
Andreas Halvorsen and big health care sector player, Larry
To view more, visit Cardinal Health's Insider Activity.
NetSuite Inc. (
A leading vendor of cloud computing business management software
suites, NetSuite enables companies to manage their core business
operations in a single system.
On Jan. 22, Chief Technology Officer Evan Goldberg sold 20,000
shares, making $1.3 million. Its trade price was $65.98.
The transaction was only days after Goldberg sold another 20,000
shares, which then made a smidge higher of $1.3 million, since
its price per share during the sale was $68.23.
The incredible amount of insiders selling NetSuite shares
evidently correspond to the stock's rising market value. Since
2008, NetSuite has sky-rocketed, from its then price of $8 at
year-end, up until today's $69.97 per share rate.
In the last year, NetSuite surged 61.35 percent. Currently, its
stock is up 1.77 percent.
Although NetSuite has not released its fourth quarter 2012
reports as of yet, it has had a prosperous earnings season based
off of its third quarter report.
In the period, NetSuite's revenue increased 31 percent, cash flow
increased 61 percent and an increase of $1.8 million in its
non-Gaap net income.
Company CEO, Zach Nelson, commented on their successful third
"As some traditional enterprise software companies struggled,
NetSuite again exceeded our stated outlook and delivered record
revenue and non-GAAP EPS. Our suite approach transforms how
mid-sized companies operate and gives them a business platform
more powerful than those used by the world's largest companies.
In addition, this year's investments in our product, sales and
services approach to bring the benefits of NetSuite to the
world's largest companies has been one of the most successful
initiatives in our history."
Nelson's sell history of NetSuite's shares stretches three pages
long on his GuruFocus Market Overview page.
Gurus who currently hold the stock include Columbia Wanger, Frank
Sands and Jim Simons.
To view more, visit NetSuite's Insider Activity.
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