Over the past seven days we’ve seen several large insider buys as well as several coming from the companies’ CEOs. It is interesting to note when a CEO, or even a CFO, buys because these insiders supposedly have the most intimate knowledge of their company's workings.
The following three CEOs each come from various sectors of the market, but they each reported insider buys with transaction amounts valued at over $100,000.
Kratos Defense & Security Solutions (KTOS)
Over the past week there were two insiders making notable buys of Kratos Defense & Security Solutions. These insiders consisted of Executive VP and CFO Deanna Lund and President and CEO Eric DeMarco.
Deanna Lund made the smaller buy of the week, adding 4,500 shares to her stake. She bought these shares at $6.69 per share for a total transaction amount of $30,105. Since her buy the price per share is up about 1.2%. Lund now holds on to at least 52,609 shares of company stock.
CEO DeMarco made a much larger buy, adding 31,273 shares to his holdings. The CEO purchased these shares at an average price of $6.40 per share for a total transaction amount of $200,147. Since then the price per share has increased about 5.78%. DeMarco now owns at least 326,468 shares of company stock.
Prior to this week, two insiders made notable buys last week. President of the Modular Systems Division, Thomas Mills, bought 4,250 shares at $6.62 per share. He now holds over 44,600 shares of company stock. And Director Jane Judd purchased 4,180 shares at $6.59 per share. She now holds on to 20,180 shares of company stock.
Prior to the company’s most recent insider buys, they had not reported any insider transactions since May 2013.
Kratos Defense & Security Solutions is a specialized national security technology business providing mission critical products, services and solutions for U.S. national security priorities.
Kratos’ historical revenue and net income:
The company’s GuruFocus analysis highlights that their revenue has been in decline over the past five years.
Chuck Royce, Jim Simons and Steven Cohen all hold a position in Kratos. Royce holds the largest position with 1,995,640 shares, representing 3.5% of the company’s shares outstanding.
The company’s third quarter financials reported:
· Revenues of $226.4 million.
· Adjusted EBITDA of $24.0 million, or 10.6% of the company’s revenue.
· Pro Forma EPS of $0.02.
· Free Cash Flow of $2.3 million.
The company also recently reported that its Public Safety & Security Solutions Division recently received $4.25 million in security system integration awards which are related to the new tenant security systems in the World Trade Center Facility.
Kratos Defense & Security Solutions has a market cap of $385.1 million. Its shares are currently trading at around $6.75 with a P/S ratio of 0.40 and a P/B ratio of 1.30.
Over the past week the CEO and Chairman of Tronox, Thomas Casey, made a notable buy back into the company. This is the first insider transaction since Casey made a buy back in June 2013.
Casey added an additional 20,000 shares to his holdings on Dec. 2. He bought these shares at $21.32 per share for a total transaction amount of $426,400. Since his buy the price per share has dropped a slight -0.42%. The CEO now holds on to at least 787,613 shares of the company’s stock.
Tronox is the largest fully integrated producer of titanium ore and titanium dioxide.
Tronox’s historical revenue and net income:
The analysis on Tronox reports that the company’s revenue has been in decline over the past year, its dividend yield is near a 2-year high and it has issued $1.9 billion of debt over the past three years.
The company recently released its third quarter financial results which reported:
· Revenue of $491 million, up 1% from $487 million last year.
· Adjusted EBITDA of $92 million, down from $134 million last year.
· Net loss of $55 million, or $0.48 per share, down from a net income of $24 million and $0.20 per share.
· Declared a dividend of $0.25 per share.
Chuck Royce, Manning & Napier Advisors and Jim Simons all hold a stake in Tronox. Jim Simons holds the largest position with 259,100 shares, representing 0.23% of the company’s shares outstanding.
Tronox has a market cap of $2.4 billion. Its shares are currently trading at around $21.15 with a P/S ratio of 1.20 and a P/B ratio of 1.00. The company also currently holds a dividend yield of 4.70%.
Martin Midstream Partners LP (MMLP)
Over the past week President and CEO Ruben Martin added 3,000 shares to his holdings. The CEO bought these shares at $41.85 per share for a total transaction amount of $125,550. Since then the price per share has increased a slight 0.17%. Martin now holds on to over 5.167 million shares of the company’s stock.
The company has a strong history of insider buying and Martin’s most recent buy comes as the company’s share price has fallen from its historical high.
Martin Midstream Partners is a limited partnership with a diverse set of operations focused primarily in the U.S. Gulf Coast region. The company engages in the storage, transportation and distribution of petroleum products and by-products.
Martin Midstream Partners’ historical revenue and net income:
The company’s third quarter financials reported:
· Adjusted EBITDA of $26.8 million, down from 2012’s $27.7 million.
· Distributable cash flow of $13.3 million, down from $19.6 million last year.
· Net income of $0.2 million, or $0.01 per share, down from $72.2 million or $3.07 per share last year.
· Revenues of $359.6 million, up from $354.1 million last year.
The company announced yesterday that its Executive VP and CFO Robert Bondurant would be presenting at the Wells Fargo Securities Energy Symposium. This presentation is set for Dec. 10 at 8:40 a.m. Eastern Standard Time.
The Peter Lynch Chart suggests that the company is currently overvalued:
Martin Midstream Partners has a market cap of $1.12 billion. Its shares are currently trading at around $42.20 with a P/E ratio of 40.10, a P/S ratio of 0.70 and a P/B ratio of 3.50. The dividend yield of Martin Midstream stocks is currently at 7.40%. The company had an annual average earnings growth of 10.20% over the past ten years.
You can view a complete list of CEO buys and sells here.
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- CEO Buys, CFO Buys: Stocks that are bought by their CEO/CFOs.
- Insider Cluster Buys: Stocks that multiple company officers and directors have bought.
- Double Buys:: Companies that both Gurus and Insiders are buying
- Triple Buys: Companies that both Gurus and Insiders are buying, and Company is buying back.