Welcome to edition 253 of Insider Weekends. Insider buying increased last week with insiders buying $38.91 million of stock compared to $33.56 million in the week prior. Selling on the other hand decreased with insiders selling $561.54 million of stock last week compared to $883.34 million 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 to 14.43. In other words, insiders sold more than 14 times as much stock as they purchased. The Sell/Buy ratio this week compares favorably with the prior week, when the ratio stood at 26.32. Before we read too much into this drop, it is important to keep in mind that we are in the thick of earnings season and hence insider transactions in general are muted. 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.
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Insider Sell Buy Ratio April 24, 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:
1. NexPoint Residential Trust, Inc (NXRT): $13.97
President James D. Dondero acquired 472,200 shares of this apartment REIT, paying $13.97 per share for a total amount of $6.59 million. These shares were acquired indirectly by Highland Capital Management, L.P.
NXRT was spun-off from the closed-end fund NexPoint Credit Strategies Fund (NHF) and started trading earlier this month. Mr. Dondero is the Co-Founder and President of Highland Capital Management, a Dallas-based investment management firm with $21 billion in assets under management.
