Insider Buys and Sells: Weekly Wrap-up
Monday, February 1, 2010 | Tycoon StaffRating:
There is no better judge of a company's health and future prospects than the actions of owners and executives of publicly traded companies. That's why insider buying and selling is a critical piece of data for investors, both institutional and individual.
As part of our continuing efforts here at The Tycoon Report to level the playing field between individual investors and the fat cats on Wall Street, we're keeping you informed -- on a daily basis and at no cost whatsoever -- of the most significant insider buying and selling.
Below is your Monday re-cap of the past week's activity of important insider buys and sells. For the most-timely data, be sure to read your Tycoon Report issues each morning!
BUYSAs part of our continuing efforts here at The Tycoon Report to level the playing field between individual investors and the fat cats on Wall Street, we're keeping you informed -- on a daily basis and at no cost whatsoever -- of the most significant insider buying and selling.
Below is your Monday re-cap of the past week's activity of important insider buys and sells. For the most-timely data, be sure to read your Tycoon Report issues each morning!
Hovnanian (HOV)
Chief Operating Officer Thomas J. Pellerito BOUGHT $1 million in shares.
SELLS
Amgen (AMGN)
V.P. of Finance and CAO Michael A. Kelly SOLD $1.8 million in options.
BB&T Corp. (BBT)
Director John A. Allison SOLD $6 million in options.
Chairman and CEO Kelly S. King SOLD $1.3 million in options.
BlackRock (BLK)
President Robert Kapito SOLD $1.9 million in shares.
Cree (CREE)
Director Dolph W. von Arx SOLD $1.2 million in shares.
McDonald's (MCD)
President, McDonald's Europe Denis Hennequin SOLD $2.4 million in options.
Ruby Tuesday (RT)
CEO Samuel E. Beall III SOLD $2.5 million in shares.
The Travelers Companies (TRV)
Vice Chairman & CIO William H. Heyman SOLD $1.2 million in options.
Volterra Semiconductor Corp. (VLTR)
President and CEO Jeffrey Staszak SOLD $1.5 million in shares and options.
Economic Calendar for the Week of Feb. 1-5
MONDAY, FEB. 1
10 a.m. ISM: Institute for Supply Management
* Importance (A-F): This release merits an A-.
* Source: Institute for Supply Management
* Release Time: 10 a.m. Eastern on the first business day of the month for the prior month.
* Raw Data Available At: http://www.ism.ws
The Institute for Supply Management's monthly Report on Business is probably the most widely watched economic indicator produced by the private sector.
The ISM index is the result of a monthly survey of over 400 companies in 20 industries throughout the 50 states. The survey queries respondents on a number of monthly indicators, including orders, production, employment, inventories, delivery times, prices paid, export orders, and import orders.
Respondents are asked to characterize each indicator as higher, lower, or unchanged for the month (or faster/slower in the case of delivery times). They are not asked for specific numbers -- only a thumbs-up or -down.
Highlights
* The December ISM Index checked in at 55.9 versus the consensus estimate of 54.3 and the prior month's reading of 53.6. A number above 50 denotes an expansion in manufacturing activity.
* The latest ISM reading was driven by a faster expansion in new orders (from 60.3 to 65.5), production (from 59.9 to 61.9), and employment (from 50.8 to 52.0), and a faster increase in prices paid (from 55.0 to 61.5).
* The supplier deliveries index rose from 55.7 to 56.6, signaling a slower pace of deliveries. That is regarded as a positive since it is viewed as a sign suppliers are busier since it takes longer to get manufacturers the supplies they need.
* The backlog of orders dipped from 52.0 to 50.0; however, with the customers' inventories index sliding from 37.0 to 35.0, the dip in the backlog of orders won't be seen as too worrisome since there is an underlying presumption that inventory restocking will continue to keep manufacturers busy in the near term.
* Separately, the exports index dropped from 56.0 to 54.5 while the imports index rose from 51.5 to 55.0.
Key Factors
* December was the fifth-straight month the ISM Index has been above 50.
* Overall, the ISM Index for December was an encouraging release. The prices paid component will raise some eyebrows, but with the core CPI data showing little pass through of higher prices at the producer level, the market has been able to digest the uptick relatively well.
WEDNESDAY, FEB. 3
10 a.m. Non-Manufacturing ISM: Institute for Supply Management
* Importance (A-F): This release merits an improved B-.
* Source: Institute for Supply Management
* Release Time: 10 a.m. Eastern on the third business day of the month for the prior month.
* Raw Data Available At: http://www.napm.org
The non-manufacturing ISM report is the result of a monthly survey of over 370 companies. The survey queries respondents on a number of monthly indicators, including orders, employment, inventories, supplier delivery times, prices paid, order backlogs, export orders, and import orders. Respondents are asked to characterize each indicator as higher, lower, or unchanged for the month (or faster/slower in the case of delivery times). They are not asked for specific numbers -- only a thumbs-up or -down.
Highlights
* As expected, the ISM non-manufacturing index returned to an expansionary phase as the index rose from 48.7 in November to 50.1 in December. The jump in the index was slightly weaker than expected as the median estimate called for the index to rise to 50.5.
* Surprisingly, export growth declined in December. After two months of expansion, the index fell from 54.5 to 46.0. Many economists have been thinking exports would be one of the leaders in U.S. growth in 2010 as the weak dollar makes US goods and services much less expensive for the rest of the world.
* Employment remains a trouble spot. While the index rose from 41.6 to 44.0, the data only suggest a slowdown in the contraction in the labor force, not a recovery.
Key Factors
* The details of the index look very promising.
* Both business activities and new orders remained entrenched above the 50.0 threshold. Business activities rose from 49.6 to 53.7 while new orders fell from 55.1 to 52.1.
* On the surface, the drop in the rate of new orders looks a little nerve-racking, yet non-manufacturing firms believe new orders growth will remain strong. Supplier deliveries rose from 48.5 to 50.5 while inventory change entered an expansionary cycle for the first time since August 2008.
Big Picture
* The market generally doesn't pay much attention to the services index because the service sector is less cyclical than the manufacturing sector. During the current recession, the service index held steady around 50.0% through September 2009 before bottoming at 37.4% in November 2008. Since then, the service index has slowly risen back and finally broke the 50.0% barrier. In contrast, the manufacturing index, with the exception of January 2009, stayed below 50% from December 2008 through July 2009 and bottomed at 32.9% in December 2008.
FRIDAY, FEB. 5
8:30 a.m. The Employment Report
* Importance (A-F): This release merits an A.
* Source: Bureau of Labor Statistics, U.S. Department of Labor.
* Release Time: First Friday of the month at 8:30 a.m. Eastern for the prior month
* Raw Data Available At: http://stats.bls.gov/news.release/empsit.toc.htm
The employment report is really two reports -- the household survey (i.e., farm workers, the self-employed, unpaid family workers, and private household workers) and the establishment (i.e., businesses) survey.
Highlights
* Payrolls dropped 85,000 for the month after the consensus had expected payrolls to post no change.
* The unemployment rate held steady at 10.0% in December and met consensus expectations.
* The average workweek held at 33.2 hours in December. Manufacturing and overtime hours also posted no change from last month.
* Average earnings increased 0.2% over the last month as hourly earnings increased from $18.77 to $18.80. Average weekly earnings grew by $1.00 to $624.16.
Key Factors
* The market was anticipating a positive increase in payrolls in December and was somewhat disappointed.
* owever, while December's decline was worse than expected, November's numbers were revised up and showed a positive 4,000 payroll gain. This was the first increase in payrolls since December 2007.
* Both goods-producing employment and service-providing employment posted negative payroll changes with drops of 81,000 and 4,000 respectively.
* Construction and manufacturing job losses provided the bulk of the payroll decline from goods-producing firms. Construction jobs declined 53,000 and are now down 1.6 million since the recession began. Manufacturing payrolls declined 27,000 and are down 2.1 million jobs since December 2007.
* Leisure and hospitality firms and government payroll declines pulled down service-producing payrolls. The recession continues to take a toll on the tourism and recreation industry as payrolls dropped 25,000. The government shed 21,000 in December, but the losses will be recouped in the next few months when the Census Bureau hires approximately 1.5 million people for the 2010 Census.
* Temporary help services provided a boost of 47,000 payrolls in December and have now increased 166,000 since July.
* Health care employment also continues to grow as payrolls increased by 22,000. In contrast to the major declines in the construction and manufacturing jobs since the recession, health care employment has increased by 631,000 since December 2007.
* However, the details of the unemployment rate are not good. The total number of employed workers declined 589,000. Unfortunately, the labor force declined by 661,000 and negated the drop in employment from the unemployment rate statistics.
* If the labor force had declined by only 134,000 -- the change from October to November -- the unemployment rate would have increased 0.3 percentage points to 10.3%.
* Those that do have jobs saw minimal gains in income.
Big Picture
* Weekly claims for unemployment have to drop below 400,000 before payrolls will stabilize.
* Limited wage growth and declining payroll levels are a recipe for very poor consumer confidence and sluggish consumer spending.
Source: Briefing.com
