Insider Buys and Sells: Weekly Wrap-Up
Monday, May 4, 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.
Danaher Corp. (DHR)
Chairman and Director Steven M. Rales SOLD $58.3 million in shares.
Additionally, President and Director Lawrence H. Culp Jr. has SOLD nearly $4.7 million in options and exercised nearly $1.9 million worth of options. View details here.
Dendreon Corp. (DNDN)
Sr. VP, CFO & Treasurer Gregory T. Schiffman SOLD nearly $2.1 million in shares. Director Douglas G. Watson SOLD $2.3 million in options. Director Ingle M Blake SOLD nearly $2.3 million in options. And Director Richard B. Brewer SOLD $2.6 million in options.
Additionally, President & CEO Mitchell Gold SOLD $3.5 million by options exercise, SOLD $1.42 million in shares and SOLD $13.5 million in options. View details here.
Marriott International (MAR)
Four sales valued at more than $2 million apiece took place last week by:
Stephen G. Marriott
David S. Marriott
John W. Marriott III
J.W. Marriott Jr.
YUM! Brands (YUM)
Chairman, President and CEO David C. Novak has SOLD $39.2 million in stock, $22.9 million in options and another $20.2 million in options, as well as exercised options for $10.3 million, $5.7 million and $4.9 million. View details here.
Economic Calendar for the Week of May 4-8
TUESDAY, MAY 5
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 a national survey of purchasing managers which covers new orders, employment, inventories, supplier delivery times, prices, backlog orders, export orders, and import orders. Diffusion indexes are produced for each of these categories, with a reading over 50% indicating expansion relative to the prior month, and a sub-50% reading indicating contraction.
This index 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
* The ISM Services Index for March unexpectedly declined to 40.8% from 41.6% in February. This was worse than the consensus estimate of 42.0 and indicates contraction in the services sector.
* This is the sixth consecutive month that the report has suggested contraction of the services sector, and the 11th time since the recession began.
* New orders slipped to 38.8% from 40.7%; supplier deliveries, which are not seasonally adjusted, held steady at 48.0%.
* The employment index dropped to 32.3% from 37.3%, reflecting the weak labor market.
* Prices paid declined to 39.1% from 48.1% after advancing in the two previous months.
* Inventories rose to 40.0% from 39.0%, although this reading not seasonally adjusted.
THURSDAY, MAY 7
8:30 a.m. Initial Claims
* Importance (A-F): This release merits a C .
* Source: The Employment and Training Administration of the Department of Labor.
* Release Time: 8:30 a.m. Eastern each Thursday (data for week ended prior Saturday).
* Raw Data Available At: http://www.dol.gov/opa/media/press/eta/main.htm
Initial jobless claims measure the number of filings for state jobless benefits. This report provides a timely, but often misleading, indicator of the direction of the economy, with increases (decreases) in claims potential signalling slowing (accelerating) job growth. On a week-to-week basis, claims are quite volatile, and many analysts therefore track a four week moving average to get a better sense of the underlying trend. It typically takes a sustained move of at least 30K in claims to signal a meaningful change in job growth.
Highlights
* The latest initial claims report brought more of the same, with initial claims of 631,000 (consensus 640,000) showing improvement from the prior week's level of 645,000, while continuing claims worsened to 6.27 million from the prior week's level of 6.14 million.
* The four-week moving average for initial claims came down to 637,250 from 648,000, while the four-week moving average for continuing claims jumped to 6.076 million from 5.944 million.
Key Factors
* The underlying message is that the pace of layoffs is slowing, but that finding a new job hasn't gotten any easier.
* What can be easy to overlook in the "positive" initial claims number is that it still suggests we'll see another huge decline (500,000-plus) in nonfarm payrolls for April.
* Notwithstanding the spending increase evident in the Q1 GDP report, there remains ample reason to be concerned about the pace of consumer spending in the months ahead.
Big Picture
* New claims for unemployment are at recessionary levels, as the financial crisis on Wall Street spilled over to Main Street in noticeable fashion with the seizing up of the credit markets in late summer/early fall 2008.
FRIDAY, MAY 8
8:30 a.m. 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 actually two separate reports which are the results of two separate surveys. The household survey is a survey of roughly 60,000 households. This survey produces the unemployment rate. The establishment survey is a survey of 375,000 businesses. This survey produces the nonfarm payrolls, average workweek, and average hourly earnings figures, to name a few. Both surveys cover the payroll period which includes the 12th of each month.
The reports both measure employment levels, just from different angles. Due to the vastly different size of the survey samples (the establishment survey not only surveys more businesses, but each business employs many individuals), the measures of employment may differ markedly from month to month. The household survey is used only for the unemployment measure - the market focusses primarily on the more comprehensive establishment survey. Together, these two surveys make up the employment report, the most timely and broad indicator of economic activity released each month.
Total payrolls are broken down into sectors such as manufacturing, mining, construction, services, and government. The markets follows these components closely as indicators of the trends in sectors of the economy; the manufacturing sector is watched the most closely as it often leads the business cycle. The data also include breakdowns of hours worked, overtime, and average hourly earnings.
The average workweek (also known as hours worked) is important for two reasons. First, it is a critical determinant of such monthly indicators as industrial production and personal income. Second, it is considered a useful indicator of labor market conditions: a rising workweek early in the business cycle may be the first indication that employers are preparing to boost their payrolls, while late in the cycle a rising workweek may indicate that employers are having difficulty finding qualified applicants for open positions. Average earnings are closely followed as an indicator of potential inflation. Like the price of any good or service, the price of labor reacts to an overly accommodative monetary policy. If the price of labor is rising sharply, it may be an indication that too much money is chasing too few goods, or in this case employees.
Highlights
* There is not much good news in the March employment report, and that is not surprising. Payrolls fell 663,000. That was in-line with an expected 650,000 decline.
* There were widespread losses by employment category. Education and health care managed an 8,000 increase, but manufacturing dropped 161,000 jobs.
* The unemployment rate shot to 8.5% from 8.1%.
* The other components of the release also reflected weakness. The average workweek fell 0.1 to 33.2 hours.
* The manufacturing workweek fell 0.2 to 39.3. This suggests a significant reduction in industrial production in March.
* Average hourly earnings rose 0.2%. The year-over-year change is 3.4%.
Key Factors
* The unemployment rate shot to 8.5% from 8.1%. It is now already well above the 8.1% average for 2009 as forecast in the Obama budget presented just weeks ago. The trend in employment suggests that the projected deficit is thus already no longer operative.
* The data can be considered about as expected, but are also clearly very weak.
Big Picture
* Employment conditions have worsened significantly in recent months. Through August 2008, payroll declines were moderate, and not at recessionary levels. The September and October declines were much larger and established a new trend. Employment conditions are not likely to improve for quite a few months, particularly as employment picks up only after an increase in overall demand.
