Insider Buys and Sells: Weekly Wrap-up
Monday, August 10, 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.
Akamai Technologies Inc. (AKAM)
Chief Scientist F. Thomson Leighton BOUGHT $1.7 million in shares. View details.
Executive Chairman George N. Conrades BOUGHT $2.1 million in shares. View details.
SELLS
American Financial Group Inc. (AFG)
Co-CEO & Co-President Carl H. Lindner III SOLD $1.9 million in shares. View details.
Ariad Pharmaceuticals Inc. (ARIA)
Chairman & CEO Harvey J. Berger BOUGHT $3 million in shares. View details.
Boston Properties Inc. (BXP)
Chairman of the Board Mortimer B. Zuckerman SOLD $21.5 million in shares. View details.
Colgate-Palmolive (CL)
CFO Stephen C. Patrick SOLD $2 million in shares. View details.
Community Health Systems, Inc. (CYH)
Division President Michael T. Portacci SOLD $1.1 million in shares. View details.
Executive VP and CFO W. Larry Cash SOLD $7.4 million in options. View details.
FedEx (FDX)
President & CEO of FedEx Express David J. Bronczek SOLD $6.3 million in options. View details.
Global Payments Inc. (GPN)
President & CEO Paul R. Garcia SOLD $6.3 million in options. View details.
Kirby Corp. (KEX)
Chairman of the Board Charles Berdon Lawrence SOLD $5.3 million in shares. View details.
Lennox International Inc. (LII)
LII EVP/President SEI Scott J. Boxer SOLD $2.4 million in options. View details.
Lorillard Inc. (LO)
Chairman, President & CEO Marvin L. Orlowsky SOLD $2.1 million in options. View details.
MasterCard Inc. (MA)
President, Intl. Markets Walter MacNee SOLD $1 million in options. View details.
Pres. Glob. Prod. & Solutions Gary J. Flood SOLD $1 million in shares and $1.5 million in options. View details.
Meritage Homes Corp. (MTH)
CEO Steven J. Hilton SOLD $1.8 million in options. View details.
Strayer University (STRA)
Chief Financial Officer Mark C. Brown SOLD $5.5 million in options. View details.
TCF Financial Corp. (TCB)
Chairman & CEO William Allen Cooper SOLD $1.5 million in shares. View details.
Tetra Tech Inc. (TTEK)
Chairman and CEO Dan L. Batrack SOLD $2.8 million in options. View details.
Director Albert E. Smith SOLD $3 million in options. View details.
TransDigm Group Inc. (TDG)
Exec. VP, CFO and Secretary Gregory Rufus SOLD $2.7 million in options. View details.
CEO W. Nicholas Howley SOLD $4.5 million in options. View details.
Unum Group (UNM)
President and CEO Thomas R. Watjen SOLD $1.1 million in options. View details.
Whole Foods Market Inc. (WFMI)
COB & Chief Executive Officer John P. Mackey SOLD $1.4 million in shares. View details.
Economic Calendar for the Week of Aug. 10-14
THURSDAY, AUG. 13
8:30 a.m. Retail Sales
* Importance (A-F): This release merits an A-.
* Source: The Census Bureau of the Department of Commerce.
* Release Time: 8:30 ET around the 13th of the month (data for one month prior).
* Raw Data Available At: http://www.census.gov/svsd/www/advtable.html
The retail sales report is a measure of the total receipts of retail stores. The changes in retail sales are widely followed as the most timely indicator of broader consumer spending patterns. Retail sales are often viewed ex-autos, as auto sales can move sharply from month-to-month. It is also important to keep an eye on the gas and food components, where changes in sales are often a result of price changes rather than shifting consumer demand.
Retail sales can be quite volatile and the advance reports are subject to rather large revisions. Retail sales do not include spending on services, which makes up over half of total consumption. Total personal consumption is not available until the personal income and consumption reports are released, typically two weeks after retail sales.
Highlights
* The Retail Sales report for June was mixed relative to expectations with total sales up 0.6% (consensus 0.4%) and sales, excluding autos, up 0.3% (consensus 0.4%).
* As expected, gasoline station sales played a leading role in the positive surprise for overall sales. When they are removed the equation, retail sales were up only 0.3%.
* Declines were registered in furniture and home furnishings stores (-0.2%), building materials (-0.9%), health and personal care stores (-0.3%), general merchandise stores (-0.4%), miscellaneous store retailers (-0.8%), and food services and drinking places (-0.9%).
* Outside of gas station sales, motor vehicle and parts dealers ( 2.3%), electronics and appliance stores ( 0.9%), sporting goods ( 0.9%), and food and beverage stores ( 0.2%) were the other areas that saw increases in spending versus May.
Key Factors
* The report reflects the uneven, and uncertain, nature of the recovery process given that there were a few pockets of strength in both discretionary categories and non-discretionary categories, as well as a few pockets of weakness. In this sense, then, the report can be described as being mixed despite the plus signs ahead of the headline numbers.
* In the broader picture, sales remain generally weak as they were down -9.0% from a year ago (-7.9%, ex-auto) and down -0.4% from the January to March period despite some early benefit from lower tax rates.
Big Picture
* Retail sales fell off dramatically starting in September. That was when the financial markets fell apart and the news became apocalyptic. Auto sales also collapsed as the news of potential auto company bankruptcies dominated headlines. Retail sales are likely to remain weak for quite a while given the current trends in employment, and the negative wealth impact for depressed prices for homes and stocks.
FRIDAY, AUG. 14
8:30 a.m. Consumer Price Index
* Importance (A-F): This release merits a B .
* Source: Bureau of Labor statistics, U.S. Department of Labor.
* Release Time: 8:30 ET, about the 13th of each month for the prior month.
* Raw Data Available At: http://stats.bls.gov/news.release/cpi.toc.htm
The Consumer Price Index is a measure of the price level of a fixed market basket of goods and services purchased by consumers. CPI is the most widely cited inflation indicator, and it is used to calculate cost-of-living adjustments for government programs and it is the basis of COLAs for many private labor agreements as well.
It has been criticized for overstating inflation, because it does not adjust for substitution effects and because the fixed basket does not reflect price changes in new technology goods which are often declining in price. Despite these criticisms, it remains the benchmark inflation index.
CPI can be greatly influenced in any given month by a movement in volatile food and energy prices. Therefore, it is important to look at CPI excluding food and energy, commonly called the "core rate" of inflation. Within the core rate, some of the more volatile and closely watched components are apparel, tobacco, airfares, and new cars. In addition to tracking the month/month changes in core CPI, the year/year change in core CPI is seen by most economists as the best measure of the underlying inflation rate.
Highlights
* Like the Producer Price Index, the Consumer Price Index came in hotter than expected for both total CPI and core CPI. Specifically, CPI was up 0.7% (consensus 0.6%) while core CPI, which excludes food and energy, was up 0.2% (consensus 0.1%).
* There was no surprise that higher gas prices were the primary reason for the uptick in CPI. The gasoline index rose 17.3% in June and drove a 4.2% increase in the transportation index, which contributed 0.64% to the change in CPI.
* As it so happens, most components, excluding the special indexes of food (0.0%) and energy ( 7.4%), were up versus May. Food and beverages increased 0.1%; housing was flat; apparel jumped 0.7%; medical care rose 0.2%, recreation was up 0.5%; education and communication increased 0.2%; and other goods and services rose 0.3%.
Key Factors
* Despite the broader-based increases in prices, the flat reading for a housing was a big swing factor that kept headline inflation from being higher than it was since housing has a 43.4% weight in the CPI report.
* Overall, core inflation still remains in the Fed's comfort zone as it is up 1.7% year-over-year versus the 1.5% year-over-year decline in total CPI, which reflects the collapse in oil prices. This report shouldn't stir inflation concerns, but it should certainly quiet deflation fears.
Big Picture
* Inflation trends have weakened. The decline in energy prices after the summer spike has taken CPI down to -1.4% on a year-over-year basis as of June 2009 data. Energy prices have again increased, yet the core rate should ease from due to weak demand. Low inflation rates are likely to continue through 2009 although deflation is not likely.
9:15 a.m. Industrial Production
* Importance (A-F): This release merits a B-.
* Source: Federal Reserve.
* Release Time: 9:15 ET around the 15th of the month (data for month prior).
* Raw Data Available At: http://www.federalreserve.gov/releases/G17/Current/g17.txt
The index of Industrial Production is a fixed-weight measure of the physical output of the nation's factories, mines, and utilities. Manufacturing production, the largest component of the total, can be accurately predicted using total manufacturing hours worked from the employment report. One of the bigger wildcards in this report is utility production, which can be quite volatile due to swings in the weather. Severe hot or cold spells can boost production as increased heating/cooling needs drive utility production up.
In addition to production, this monthly report also provides a measure of capacity utilization. Though the rate of capacity utilization is seen as a critical gauge of the slack available in the economy, the market does not completely trust this measure. Capacity is very difficult to measure, and the Fed essentially assumes that growth in capacity in any given year follows a straight line. One can therefore predict the capacity utilization rate quite accurately based on the assumption for production growth.
The 85% mark is seen as a key barrier over which inflationary pressures are generated, but given revisions to these data and the difficulties with capacity measurement, the 85% mark should be viewed cautiously. It would be appropriate to look for corroborating inflation indications from commodity prices and vendor deliveries.
Highlights
* Industrial production declined -0.4% in June following a downwardly revised -1.2% decline (from -1.1%) in May. The headline print was better than the consensus estimate among economists, which called for a -0.6% decline, yet it still marked the 17th decline in output over the last 18 months.
* Looking at the major industry groups, manufacturing output dropped -0.6% (vs. -1.1% in May), the output of mines fell -0.5% (vs. -1.9%), and the output of utilities rose 0.8% (vs. -1.3%).
* Total capacity utilization dropped to 68.0% from 68.3% in May and marks a new record low dating back to 1967. Similarly, manufacturing capacity utilization dipped to 64.6% from 64.9% in May and is at its lowest level since records began in 1948.
Key Factors
* The prevailing message in this report is that production levels aren't good, yet they are clearly less bad than before. In its release, the Federal Reserve highlighted the point a number of times how the rate of contraction in the second quarter improved versus the first quarter. To that end, output fell at an annual rate of -11.6% for the second quarter as a whole versus a -19.1% decline for the first quarter.
* The depressed utilization rates should temper inflation concerns. At the same time, the slowing rate of deceleration in industrial production should contribute to the hope that better numbers lie ahead as inventories get replenished.
* The June decline was the "best" number since a -0.1% decline in July 2008.
Big Picture
* Production held up surprisingly well through most of 2008 due in part to strong exports. Exports grew at a 7.0% annual rate in 2005, 9.1% in 2006, 8.4% in 2007, and at an annual average rate of 7.8% through the first three quarters of 2008. A major factor in this boom was a continually weakening dollar. Now, the dollar has strengthened and global economies are in recession. This will undermine export growth and take away a major support for U.S. industrial production. U.S. companies will also be impacted by the weak economic outlook. Production is therefore likely to remain depressed.
9:55 a.m. University of Michigan Consumer Sentiment Index
* Importance (A-F): This release merits a B-.
* Source: The University of Michigan.
* Release Time: Preliminary: 10:00 ET on the second Friday of the month (data for current month); Final: 10:00 ET on the fourth Friday of the month (data for current month).
The Michigan index is almost identical to the Conference Board Consumer Confidence index, though there are two monthly releases, a preliminary and final reading. Like the Conference Board index, it has two subindexes -- expectations and current conditions. The expectations index is a component of the Conference Board's Leading Indicators index.
Big Picture
* Sentiment readings are a reflection of a variety of events rather than an accurate tool for forecasting consumer spending. Gas prices and political events can have an outsized impact on sentiment. In general, these data are of very little economic value.
Source: Briefing.com
