Insider Weekends – October 17, 2015

Insider buying declined again last week with insiders buying $24.71 million of stock compared to $55.32 million in the week prior. Selling also declined with insiders selling $295.56 million of stock last week compared to $489.91 million in the week prior. Insider transactions are likely to stay muted over the next week or two as we get into the thick of earnings season.

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 11.96. In other words, insiders sold almost 12 times as much stock as they purchased. The Sell/Buy ratio this week compares unfavorably with the prior week, when the ratio stood at 8.85. 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.

Insider Sell Buy Ratio October 16, 2015

Insider Sell Buy Ratio October 16, 2015

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. Ryman Hospitality Properties, Inc. (RHP): $53.05

Chairman & CEO Colin V. Reed acquired 6,658 shares of this hotel operator, paying $53.04 per share for a total amount of $353,140. Mr. Reed increased his stake by 0.74% to 909,429 shares with this purchase.

With revenue per available room (RevPAR) at U.S. hotels at a 15 year high, it is no surprise that insiders of hotel REITs have been purchasing shares of their company. This increase is surprising given the rapid rise of Airbnb over the last few years and speaks volumes about the high demand for temporary accommodation.

RevPAR 2001 to 2015

RevPAR 2001 to 2015

You can view the list of recent insider transactions for Ryman Hospitality Properties, Inc. here.

P/E: 22.22 Forward P/E: 17.06 Industry P/E: 18.24
P/S: 2.55 Price/Book: 7.11 EV/EBITDA: 14.87
Market Cap: $2.69B Avg. Daily Volume: 278,426 52 Week Range: $45.22 – $64.97

2. Rovi Corporation (ROVI): $11.44

Director Glenn W. Welling acquired 22,270 shares of this multimedia company, paying $11.14 per share for a total amount of $248,088. These shares were purchased indirectly by Engaged Capital Master Feeder I, LP.

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Disclosure: None.

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