Large insider trading is one of the most important signals for investors to sense the danger ahead which might happen both to the fundamentals and the stock prices of the companies. When majority shareholders or, especially the executives, begin to sell off their personal large holdings, investors should be very cautious to detect the potential problems in the companies. According to GuruFocus insider trades, in the last several days, five corporations experienced the large sell off of their presidents, owners or executives. Each short position amounted to the value of more than $5 million. Here are the top candidates:
Under Amour (UA, Financial) is involved in development, marketing and distribution of branded performance apparel, footwear and accessories. Those products are sold to athletes at all levels, from amateur to professional through more than 23,000 retail stores worldwide. Kevin Plank, the president, CEO and 10% owner has completed the short position of 143,100 at the average price of $84.3, with the total value of more than $12 million at Nov. 1, 2011. The price is currently at $82.05 a share, off nearly 2.7% from the selling price. It is valued at 55.9x earnings and generating TTM negative cash flow.
GNC Holdings (GNC, Financial) is the holding company of specialty retailer of nutritional supplements including vitamins, minerals and herbal supplements, sports nutrition, diet and wellness products. The business is operated via franchise agreements located in the U.S. and 48 other countries. Just yesterday, Joe Fortunato, the president and CEO sold out 422,900 shares at the price of $24.78, with the total position value of more than $10 million. The share is trading at $24.56, valuing the company at 21.9x earnings and 14.8x cash flows.
VF Corp (VFC, Financial): The company is the business of designing and manufacturing apparel and footwear for all ages. The company owns the portfolio of brands in jeanswear, outerwear, packs, footwear, sportswear and occupational apparel categories. Its products are sold globally through independent licensees and distributors. Just two months ago, it acquired Timberland company. On October 27, the company’s chairman, president and CEO, Eric Wiseman, sold off 400,000 shares at around $139 a share, with the total trading value of more than $5.5 million. At $135.5 a share, the market is valuing VFC at P/E of 23.8 and P/CF of 22.9.
Compass Mineral International (CMP, Financial) is the producer of minerals including salt, sulfate of potash specialty fertilizer and magnesium chloride. At the end of fiscal year 2010, the company was operating 11 productions and packaging facilities including the rock salt mine in different areas and countries. The CEO, Angelo Brisimitzakis exited 65,000 shares at the average price of $79.26, of more than $5.1 million in total value. Currently, CMP is more than 6% off from that price, staying at $74.5. Earning multiple is 14.7x and cash flow multiple is at 8.9x.
PPG Industries (PPG, Financial) is the business of producing and supplying protective and decorative coatings, optical and specialty materials, commodity chemicals and glass. More than 58,000 shares have been sold by its chairman, CEO at $87.28 with the total value of over $5 million. Currently, it is trading at more than 3% off from the selling price, at $84.6/share, of 12.6 P/E and 9.8 P/CF.
Under Amour (UA, Financial) is involved in development, marketing and distribution of branded performance apparel, footwear and accessories. Those products are sold to athletes at all levels, from amateur to professional through more than 23,000 retail stores worldwide. Kevin Plank, the president, CEO and 10% owner has completed the short position of 143,100 at the average price of $84.3, with the total value of more than $12 million at Nov. 1, 2011. The price is currently at $82.05 a share, off nearly 2.7% from the selling price. It is valued at 55.9x earnings and generating TTM negative cash flow.
GNC Holdings (GNC, Financial) is the holding company of specialty retailer of nutritional supplements including vitamins, minerals and herbal supplements, sports nutrition, diet and wellness products. The business is operated via franchise agreements located in the U.S. and 48 other countries. Just yesterday, Joe Fortunato, the president and CEO sold out 422,900 shares at the price of $24.78, with the total position value of more than $10 million. The share is trading at $24.56, valuing the company at 21.9x earnings and 14.8x cash flows.
VF Corp (VFC, Financial): The company is the business of designing and manufacturing apparel and footwear for all ages. The company owns the portfolio of brands in jeanswear, outerwear, packs, footwear, sportswear and occupational apparel categories. Its products are sold globally through independent licensees and distributors. Just two months ago, it acquired Timberland company. On October 27, the company’s chairman, president and CEO, Eric Wiseman, sold off 400,000 shares at around $139 a share, with the total trading value of more than $5.5 million. At $135.5 a share, the market is valuing VFC at P/E of 23.8 and P/CF of 22.9.
Compass Mineral International (CMP, Financial) is the producer of minerals including salt, sulfate of potash specialty fertilizer and magnesium chloride. At the end of fiscal year 2010, the company was operating 11 productions and packaging facilities including the rock salt mine in different areas and countries. The CEO, Angelo Brisimitzakis exited 65,000 shares at the average price of $79.26, of more than $5.1 million in total value. Currently, CMP is more than 6% off from that price, staying at $74.5. Earning multiple is 14.7x and cash flow multiple is at 8.9x.
PPG Industries (PPG, Financial) is the business of producing and supplying protective and decorative coatings, optical and specialty materials, commodity chemicals and glass. More than 58,000 shares have been sold by its chairman, CEO at $87.28 with the total value of over $5 million. Currently, it is trading at more than 3% off from the selling price, at $84.6/share, of 12.6 P/E and 9.8 P/CF.
