Insiders: Earnings season is in full swing. Here are the insider moves that matter.
The blackout period or earnings season stops a lot of insider trade, but some of the few that did trade caught our attention.
$CONN, $EEI, $BLFS, $CAL, $ERII, $HTA, $MCS, $MOV, $SAIC, $SCHL, $URBN
In this report, we examine stocks that C-level officers and directors bought and sold ending the week of April 13, 2018.
Insiders sell stock for many reasons, but they generally buy for just one – to make money. As a standard, we only look at material amounts of money, $100 thousand or more, as anything less could just be window dressing.
The bar is different with selling, because the natural state of management is to be sellers. This is because most companies provide significant amounts of management compensation packages as stock. Therefore, with selling, we analyze for unusual patterns, such as insiders selling 25 percent or more of their holdings or multiple insiders selling near 52 week lows.
To learn more about our strategy, visit The Insiders Fund. We welcome your comments on our analysis.
Note: We may own positions, long or short, in any of these names but do not disclose that information nor give those positions extra emphasis in our reports.
This Week's Buys
Conn's Inc (CONN)
Inside Trade Info: Conn’s Inc CONN Officer, Daly Brian, purchased 5,100 shares at $27.87 for a total of $142.1 thousand and VP, Bchara George L, purchased 7,390 shares at $27.41 for a total of $202.5 thousand.
Buy high, buy lower? This is not the traditional way of making money but perhaps Otto is on to something. The REIT pays over 10% at today’s prices. The challenge is, of course, Amazon and the fall of store-based retail.
Why is it unusual? Both of the insiders were newly assigned, so we were not interested in this transaction at first. However, we soon realized that we were wrong. First, they bought significant amount (compared to previous transactions). Second, they made a purchase soon after the price drop. We will let you decide.
Ecology & Environment, Inc (EEI)
Inside Trade Info: Ecology & Environment, Inc EEI Officer/Director, Frank Ronald L, purchased 9,057 shares at $11.42 for a total of $103.4 thousand.
Why is it unusual? When it comes to micro-cap company transaction, we tend to be more cautious as it’s more risky. However, we like these kind of transactions if we can find unusual patterns. Ronald L Frank, co-founder of EEI in 1970, has been longing shares since 2012. He usually bought in a range of $8 thousand to $20 thousand. Then, he bought $103.4 thousand. In addition, he has maintained his performance for a long time. We do not know why he bought so much suddenly to be honest, but let’s see how this turns out.
This Week's Sells
BioLife Solutions Inc (BLFS)
Inside Trade Info: BioLife Solutions Inc LFS Director, Girschweiler Thomas, sold 1,025,000 shares at $5.26 for a total of $5.4 million.
Why is it unusual? Thomas Girschweiler just sold 36.3% of his holdings. He sold $5.4 million, but that’s not what we are shocked about. We are shocked about the market cap. BLFS’s market cap is $100M. So, the director just sold 5% of total market cap. Also, the company’s stock price was not doing so well for couple years. It was in a range of $1 to $2. In 2017, the price started rise and it reached $5.26. Could this be coincidence?
Scholastic Corp (SCHL)
Inside Trade Info: Scholastic Corp SCHL Chairman, Robinson M Richard, sold 37,077 shares at $38.63 for a total of $1.4 million.
Why is it unusual? First, this is a massive sale by Robinson M Richard Jr., a Chairman of SCHL. Second, he seems to know when to sell. He was holding on to his shares until the price recovered in 2014. He has been actively selling his shares as the price of the company is higher than ever. How can we not find this transaction interesting?
Urban Outfitters Inc (URBN)
Inside Trade Info: Urban Outfitters Inc URBN Officer, Donnelly Trish, sold 10,311 shares at $38.62 for a total of $398.2 thousand.
Why is it unusual? Trish Donnelly is an experienced CEO who used to serve as Executive VP at J. Crew. She has been serving as CEO of Urban Outfitter since 2016. We know that she has been with the firm for a long time. However, she recently sold all of her shares while the stock was high. We do not know why, but we are seeing a pattern.