Insider Buys and Sells: Weekly Wrap-up
Monday, October 19, 2009 | Tycoon StaffRating:
For all the analysts and pundits in the financial media, there is still no better judge of a company's health and future prospects than the owners and executives of those companies themselves, along with major institutional shareholders.
That's why insider buying and selling is a critical piece of data that is monitored by people who invest for a living.
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 a weekly re-cap of the past week's activity of important insider buys and sells. We aim to publish this re-cap every Monday, and it can be accessed in your e-mail issues or on the Tycoon Report Web site.
Very important note: While these re-caps are available on the Tycoon Report Web site, if you want the most timely information we provide on insider buying and selling, be sure to read the e-mail issues that we send each weekday morning.
That's why insider buying and selling is a critical piece of data that is monitored by people who invest for a living.
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 a weekly re-cap of the past week's activity of important insider buys and sells. We aim to publish this re-cap every Monday, and it can be accessed in your e-mail issues or on the Tycoon Report Web site.
Very important note: While these re-caps are available on the Tycoon Report Web site, if you want the most timely information we provide on insider buying and selling, be sure to read the e-mail issues that we send each weekday morning.
SELLS
Best Buy (BBY)
Chairman Richard M. Schulze SOLD $2.4 million in shares. View details.
Gilead Sciences (GILD)
Chairman & CEO John C. Martin SOLD $4.5 million in options. View details.
Helen of Troy (HELE)
Chairman, CEO & President Gerald J. Rubin SOLD $1.3 million in shares. View details.
Hot Topic (HOTT)
CEO Elizabeth McLaughlin SOLD $1.8 million in options. View details.
Macy's (M)
Chairman, President & CEO Terry J. Lundgren SOLD $5.8 million in options. View details.
Molson Coors Brewing Co. (TAP)
Global CLO & Mng Dir MC LLC Samuel D. Walker SOLD $1.2 million in options. View details.
Red Hat (RHT)
EVP, Chief Financial Officer Charles E. Peters Jr. SOLD $1.7 million in options. View details.
Economic Calendar for the Week of Oct. 19-23
TUESDAY, OCT. 20
8:30 a.m. Housing Starts and Building Permits
* Importance (A-F): This release merits a B-.
* Source: The Census Bureau of the Department of Commerce
* Release Time: 8:30 a.m. Eastern around the 16th of the month (data for one month prior).
* Raw Data Available At: http://www.census.gov/const/www/newresconstindex.html
Housing Starts are a measure of the number of residential units on which construction is begun each month. A start in construction is defined as the beginning of excavation of the foundation for the building and is comprised primarily of residential housing.
Building permits are permits taken out in order to allow excavation. An increase in building permits and starts usually occurs a few months after a reduction in mortgage rates. Permits lead starts, but permits are not required in all regions of the country, and the level of permits therefore tends to be less than the level of starts over time.
Highlights
* New housing starts increased 1.5% in August to 598,000 units, exactly what the consensus forecast.
* Single family home starts declined (-3.0%) for the first time since March.
* Multi-family construction rose 25.2% to 119,000 units. Unlike single family units, multi-family construction is extremely volatile and is very difficult to predict.
* Building permit authorizations increased 2.7% to 579,000. As with the new housing starts, the increase in permits was all in the multi-family sector. Single family permits fell 0.2% to 462,000 permits while multi-family permits rose 15.8% to 117,000.
* Housing completions declined 5.5% to 760,000 units. Broken down, single-family completions fell 1.6% while multi-family completions declined 11.7%.
Key Factors
* Single family unit construction generally follows a very smooth growth trend. The interruption of the current trend can either be a blip in the data or more likely a slight kink that will push estimates for housing starts lower over the next couple of months.
* The construction sector continues to face problems on multiple fronts (e.g., falling prices, rising foreclosure rates, higher unemployment), and the decline in single-family homes would actually spell relief to the sector in the long run. However, the market is itching for a return to normal (i.e., pre-bubble) construction growth and will be disappointed until it occurs.
Big Picture
* Housing starts are at extremely low levels and the outlook is not likely to improve any time soon due to high levels of inventories of unsold new homes. An uptrend in construction will require an improvement in employment and income, and then take some time as inventories need to be reduced. Government action to boost mortgage lending may also help, and starts might stabilize in the second half of the year.
8:30 a.m. Producer Price Index
* Importance (A-F): This release merits a B-.
* Source: Bureau of Labor statistics, U.S. Department of Labor.
* Release Time: Around the 11th of each month at 8:30 a.m. Eastern for the prior month.
* Raw Data Available At: http://stats.bls.gov/news.release/ppi.toc.htm
The Producer Price Index measures prices of goods at the wholesale level. There are three broad subcategories within PPI: crude, intermediate and finished. The market tracks the finished-goods index most closely, as it represents prices for goods that are ready for sale to the end user.
At all stages of production, the market places more emphasis on the index excluding food and energy, referred to as the core rate. Food and energy prices tend to be quite volatile and obscure trends in the underlying inflation rate.
Though the market reaction is determined by the month-to-month changes, year-over-year changes are also noted by analysts. The index is not revised on a monthly basis, but annual revisions to seasonal adjustment factors can produce small adjustments to past releases.
Highlights
* Producer prices rose 1.7% month-over-month, a much greater rate than expected in August. Consensus forecast a rise of only 0.8%.
* A closer look at monthly data shows that the increase in the month-over-month headline inflation was due to a strong rebound in both oil (8.0%) and food prices (0.4%).
* Excluding oil and food prices, the core index rose a much more modest 0.2%.
* Finished consumer good prices increased 2.3% in August after falling 1.5% in July. Increased car prices (0.7%) pushed up consumer durable prices 0.3%. Capital equipment prices increased 0.3% after declining 0.2% in July.
* The intermediate materials, supplies, and components stage of processing group posted a 1.8% month-over-month increase in August. As with the finished goods, most of the increase was due to higher energy prices as core intermediate prices increased only 0.6%.
* The crude stage of processing group increased 3.8%. The details are a little more troubling. Even though energy prices rose 6.9%, a decline in food prices pushed core crude prices up 6.0%. Much of the increase in core crude prices was due to a large increase in iron and steel scrap prices (13.5%).
Key Factors
* The increase in PPI should not give inflation hawks worry about runaway inflation. The year-over-year PPI index has declined nine consecutive months including a 4.3% decline in August.
* At this time were are not worried that the increases in the early stage of process groups will pass through to the headline numbers, but we are going to watch the details more closely over the next few months.
Big Picture
* PPI trends were highly volatile in 2008, mirroring the trends in global oil prices. Falling global commodity prices and weak economic demand will keep inflation in check at the producer level. If global economies remain weak in 2009, as is widely expected, inflation at the producer level will be insignificant. There may even be concerns about global deflation.
Source: Briefing.com
