There are many different strategies to trade stocks and one of them is to find the insider trading of stocks. When corporate insiders trade in their own securities, they must report their trades to the Securities and Exchange Commission (SEC), usually within a few business days of the trade. Insider trading cannot be based on material non-public information. However, many investors believe that corporate insiders may have better insight into the growth of the company and its proceedings.
In this article, I will focus on notable insider sell transactions from large-cap companies (market cap greater than $10 billion) filed at the SEC on July 27, 2012. I have also included the key financial metrics of each company. You can use this list as a potential starting point for your analysis.
Definition of Insider:
Corporate insiders are either a company's officers, directors, or any beneficial owners of more than ten percent of a class of the company's equity securities registered under Section 12 of the Securities Exchange Act of 1934.
Rule 10b5-1 Definition:
A rule established by the SEC that allows insiders of publicly-traded corporations to create a trading plan of whenand how to buy or sell shares in that company. Rule 10b5-1 allows major holders to buy or sell a predetermined number of shares at a predetermined time. 10b5-1 plans are used by many corporate insiders to avoid the accusations of insider trading, regardless of what nonpublic knowledge he/she may later come to possess.
1. Microsoft Corporation (MSFT): Microsoft Corporation develops, licenses, and supports a range of software products and services for various computing devices worldwide. Microsoft has a market cap of $249.97 billion and is currently trading around $29.75 with a 52-week range of $23.79-$32.95. The stock has gained 14.6% year to date.
According to SEC filing on July 27, 2012, Gates William H III (Director) sold a total of 3,000,000 shares at a total value of $86,967,300 through Rule 10b5-1 trading plan. On July 19, 2012, Microsoft reported its fourth-quarter earnings results with a quarterly revenue of $18.06 billion. Over the past three months, there have been a total of 15 insider transactions with 7 Sell transactions. Key financial metrics for Microsoft are given below:
The following chart provides the insider trading summary for a three-month and 12-month period.
2. H.J. Heinz Company (HNZ): H. J. Heinz Company manufactures and markets food products for consumers, and foodservice and institutional customers in North America, Europe, the Asia Pacific, and internationally. H.J. Heinz has a market cap of $17.70 billion and is currently trading around $55.27 with a 52-week range of $48.17 to $55.48.The stock has gained 2.28% year to date.
According to SEC filing on July 27, 2012, Peltz Nelson (Director) sold a total of 500,000 shares at a total value of $27,649,850. Please refer to the footnote in Form 4 for more details on the ownership. Over the past three months, there have been a total of 21 insider transactions with four sell transactions. The current price is fairly close to its 52-week high. Key financial metrics for H.J. Heinz is given below:
The following chart provides the insider trading summary for a three-month and 12-month period.
3. Qualcomm Inc (QCOM): Qualcomm designs, develops, manufactures, and markets digital telecommunications products and services. Qualcomm has a market cap of $101.08 billion and is currently trading around $59.34 with a 52-week range of $45.98 to $68.87. The stock has gained 8.48% year to date.
According to SEC filing on July 27, 2012, Stern Marc I (Director) sold a total of 44,000 shares at a total value of $2,537,430. Over the past three months, there have been a total of 29 insider transactions with 23 Sell transactions. Key financial metrics for Qualcomm is given below:
The following chart provides the insider trading summary for a three-month and 12-month period.
Sources: Some of the data is sourced from Google Finance, Nasdaq, Finviz, Fidelity, and SEC.gov.
Additional Disclosure: I change my positions very frequently and may initiate either long or short positions in the above mentioned stocks at any time.
Disclaimer: I am not a registered investment advisor and do not provide specific investment advice. The information contained herein is for informational purposes only. Nothing in this article should be taken as a solicitation to purchase or sell securities. Before buying or selling any stock you should do your own research and reach your own conclusion. It is up to investors to make the correct decision after necessary research. The information and data is believed to be accurate, but no guarantees or representations are made.
Disclosure: I have no positions in any stocks mentioned, but may initiate a long position in QCOM over the next 72 hours.
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