Insider Weekends – November 15, 2015

Insider buying increased significantly last week with insiders buying $193.44 million of stock compared to $39.44 million in the week prior. Selling also increased with insiders selling $2.88 billion of stock last week compared to $1.36 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 down to 14.87. In other words, insiders sold almost 15 times as much stock as they purchased. The Sell/Buy ratio this week compares favorably with the prior week, when the ratio stood at 34.56. 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 November 13, 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:

Beyond the top 5 purchases mentioned below, there were several other interesting insider purchases that did not make the list. Some of these purchases include the Chairman of copper mining company Southern Copper (SCCOpicking up an additional $5.2 million worth of stock, a cluster of purchases by three insiders of fertilizer company CF Industries (CF), a purchase by the CEO of medical equipment company MiMedx (MDXG), purchases by a cluster of 5 insiders of ethanol producer Pacific Ethanol (PEIX) and a purchase by the CEO of footwear company Crocs (CROX).

1. Restaurant Brands International Inc. (QSR): $35.55

Shares of this operator of Burger King and Tim Hortons were acquired by 2 insiders:

  • Director Carlos Alberto Sicupira acquired 196,000 shares, paying $35.56 per share for a total amount of $6.97 million. These shares were acquired indirectly through Lobstertail Corporation.
  • Director Paul J. Fribourg acquired 112,700 shares, paying $35.47 per share for a total amount of $3.99 million. Mr. Fribourg increased his stake by 243.18% to 159,045 shares with this purchase.

Mr. Sicupira is a partner at Brazilian private equity firm 3G Capital that teamed up with Warren Buffet to acquire Burger King and then merged the company with Tim Hortons. These two purchases follow a purchase by another director last week.

You can view the list of recent insider transactions for Restaurant Brands International Inc. here.

P/E: N/A Forward P/E: 27.35 Industry P/E: N/A
P/S: 2.1 Price/Book: 4.92 EV/EBITDA: 14.15
Market Cap: $7.20B Avg. Daily Volume: 1,039,650 52 Week Range: $34.19 – $45.71

2. SolarCity Corporation (SCTY): $25.85

Chairman of the Board and 10% owner Elon Musk acquired 307,152 shares of this solar systems installer, paying $25.35 per share for a total amount of $7.79 million. These shares were purchased indirectly through a trust.

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Disclosure: None.

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