Over the past week 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 and one CEO reported an insider sell raking in over.
Kinder Morgan (KMI)
This past week Kinder Morgan continued their trend of insider buying as two corporate executives made buys on Feb. 24. The two insiders added over 200,000 shares to their holdings as the share price sits at its 52-week low.
Chairman and CEO Richard Kinder made the largest buy of the week adding 199,165 shares to his position. The CEO bought these shares at $32.09 per share for a total transaction amount of $6,391,205. Since his buy the price per share has dropped a slight -0.75%. Kinder now holds on to 243 million shares of his company’s stock, making him the largest individual shareholder of the company.
- Warning! GuruFocus has detected 6 Warning Signs with KMI. Click here to check it out.
- KMI 15-Year Financial Data
- The intrinsic value of KMI
- Peter Lynch Chart of KMI
Vice President Dax Sanders added a much smaller 1,000 shares to his stake on Feb. 24. The insider bought these at $32.35 per share for a total transaction amount of $32,350. Since his buy the price per share is down about -1.55%. Sanders now holds on to at least 266,499 shares of the company’s stock.
Insider buying has increased for the company since the price has dwindled down from its previous 10-year highs.
Late last year VP of HR and Administration James Street made several buys as did Director Fayez Sarofim. To read more about their buys, check out Kinder Morgan’s Insider Trades’ page.
Kinder Morgan is engaged as the energy transportation and storage companies in North America. Kinder Morgan is the largest midstream and the third largest energy company (based on combined enterprise value) in North America.
Kinder Morgan’s historical revenue and net income:
The analysis on Kinder Morgan reports that the revenue has been in decline over the past three years, it has issued $4.8 billion in debt over the past three years and the dividend yield is nearing a three-year high.
The company recently announced that its collaborative project with Valero Energy (VLO) is now fully operational and is transporting petroleum products from refineries in Louisiana to Mississippi.
The company recently announced its financial expectations for 2014 which reports the company’s expectations to:
- Generate approximately $6.4 billion in business segment earnings before DDA, an increase of about $750 million over the 2013 forecast.
- Distribute over $2.5 billion to its limited partners.
- Invest approximately $3.6 billion in expansions and small acquisitions.
- Almost $720 million of the equity required for the investment program is expected to be funded by KMR share dividends.
Kinder Morgan has a market cap of $32.66 billion. Its shares are currently trading at around $31.69 with a P/E ratio of 35.30, a P/S ratio of 2.90 and a P/B ratio of 2.49. The dividend yield of Kinder Morgan stock is 5.00%.
Over the past week three insiders mad buys into the guru-favorite Coca-Cola. These three corporate executives made the first insider buys for the company since March 2013.
Director Maria Lagomasino purchased 7,981 shares of Coca-Cola at the price of $37.57 per share on Feb. 24. She spent a total of $299,846 on this transaction, and since her buy the price per share is up a slight 0.67%. Lagomasino now holds on to at least 23,631 shares of the company’s stock.
Director Ana Botin also added some shares to her stake on Feb. 24. The director purchased a total of 2,500 shares at $37.25 per share. This buy cost her a total of $93,125, and since her buy the price per share is trading up approximately 1.53%. Botin now holds on to at least 2,500 shares of Coca-Cola’s stock.
Lastly Chairman and CEO Ahmet Muhtar Kent purchased the largest amount, adding 10,500 shares to his holdings. The CEO bought these at the price of $37.91 per share for a total transaction amount of $398,055. Since his buy the price per share has dropped approximately -0.24%. Kent now holds on to at least 597,616 shares of the company’s stock.
Coca-Cola is a beverage company. It owns or license and market more than 500 nonalcoholic beverage brands, mainly sparkling beverages but also a variety of still beverages such as waters, enhanced waters, juices and juice drinks, ready-to-drink teas and coffees, and energy and sports drinks.
Coca-Cola’s historical revenue and net income:
The analysis on Coca-Cola reports that the revenue has slowed over the past year, they have issued $14.4 billion of debt over the past three years and its P/S, P/B and P/E ratios are all trading at historical lows.
The Peter Lynch Chart suggests that the company is currently overvalued:
Coca-Cola has a market cap of $168.31 billion. Its shares are currently trading at around $38.20 with a P/E ratio of 19.80, a P/S ratio of 3.66 and a P/B ratio of 5.20. The company had an annual average earnings growth of 9.30% over the past ten years.
GuruFocus rated Coca-Cola the business predictability rank of 5-star.
EarthLink Holdings (ELNK)
Last week the CEO of EarthLink Holdings, Joseph Eazor, made a buy of 64,600 shares of his company’s stock. He bought these shares at $3.88 per share for a total transaction amount of $250,648. Since then the price per share has dropped -0.77%.
This CEO buy comes as the company’s price is sitting at its 3-year low.
EarthLink is an IT services, network and communications provider. EarthLink provides customers with managed IT services including cloud computing, data centers, virtualization, security, applications and support services,
EarthLink’s historical revenue and net income:
The analysis on EarthLink reports that the revenue has been in decline over the past year, its dividend yield is near a 2-year high and its price and P/S and P/B ratios are near 10-year lows.
The company recently reported its fourth quarter results which reported:
- $301.8 million in revenues.
- Net loss of $(279.9) million, or $92.75) per share.
- Adjusted EBITDA of $50.1 million.
- Ending cash balance of $116.6 million.
There are four gurus that maintain a position in EarthLink. Check out their holding histories here.
EarthLink has a market cap of $392.5 million. Its shares are currently trading at around $3.85 with a P/S ratio of 0.30 and a P/B ratio of 0.91. The dividend yield of EarthLink Holdings is at 5.20%. The company had an annual average earnings growth of 13.60% over the past ten years.
You can view a complete list of CEO buys and sells here.
- 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.