Archive for July, 2010

Insider Weekends – July 30, 2010

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July 31, 2010 | Insider Buying | Author Asif

Welcome to the eighth edition of Insider Weekends. Insider buying rebounded last week with insiders purchasing $13.42 million of their stock last week when compared to just $3.4 million in the week prior. Selling picked up pace with insiders selling $498.22 million worth of stock.

Sell/Buy Ratio:

The insider Sell/Buy ratio is calculated by dividing the total insider sales in a given week by total insider buying in that week. The adjusted ratio for last week dropped to 37.11. In other words, insiders sold almost 37 times as much stock as they purchased. A large part of this was once again driven by sales of AutoZone by famous hedge fund manager Edward (Eddie) Lampert and his fund ESL Partners. While we normally exclude fund sales, Mr. Lampert also happens to be a 10% owner and sold more than a third of these shares directly. Removing the AutoZone sales drops the ratio to 32.97.

The Sell/Buy ratio this week compares favorably with the week prior when the ratio stood at 98.64 (51.13 without the AutoZone sales). We are calculating an adjusted ratio by removing transactions by funds and companies and trying as best as possible only to retain information about insiders and 10% owners who are not funds or companies.

How Fresh is This Data?

I received a question from a subscriber last week who wanted to know more about the freshness of the data we are presenting in these blog entries. Insider transaction filings usually come in until almost 10 PM EST every weekday. We collect this data all week long until 10 PM EST on Friday night. I then identify the notable buys and sells on Friday night and pass these on to Ann, who in turn collects the key statistics and other information on Saturday. I calculate the Sell/Buy ratio on Saturday, complete the blog entry and we publish on Sunday. So the data you receive on Sunday is fresh off the presses.

In comparison, the weekly insider transactions list published by Barron’s magazine is only looking at data as of Wednesday of the previous week and the key insider transactions published by Value Line (VALU) every Monday are almost two weeks old.

Notable Insider Buys:

1. BlackRock, Inc. (BLK): $157.49

Director James Grosfeld acquired 41,000 shares of this publicly owned Investment Manager firm, paying $152.37 per share for a total amount of $6.25 million.

P/E: 19.01 Forward P/E: 14.62 Industry P/E: 17.52
P/S: 4.5 Price/Book: 1.23 EV/EBITDA: 12.33
Market Cap: $30.06B Avg. Daily Volume: 524,223 52 Week Range: $138.42 – $243.80

2. Eagle Bancorp, Inc. (EGBN): $11.56

President and CEO Ronald Paul acquired 80,000 shares, paying $11.23 per share for a total amount of $898,200. Director Neal Gross acquired 15,000 shares of this regional bank paying $11.11 per share for a total amount of $166,700.

The troubled asset ratio (TAR) of EGBN has fallen in recent quarters to 12 when compared to the national median of 15 (as of March 2010). EGBN had $1.8 billion in assets as of March 2010.

P/E: 19.76 Forward P/E: 13.6 Industry P/E: 15.75
P/S: 3.3 Price/Book: 1.24 EV/EBITDA: N/A
Market Cap: $227.18M Avg. Daily Volume: 69,252 52 Week Range: $7.7 – $14.49

3. Cymer Inc. (CYMI): $33.28

Director Eric M Ruttenberg acquired 17,000 shares of this semiconductor equipment manufacturer, paying $33.59 per share for a total amount of $571,030. Mr. Ruttenberg is co-managing member of New York based fund Tinicum Capital Partners.

P/E: 16.72 Forward P/E: 10.27 Industry P/E: 22.29
P/S: 2.31 Price/Book: 1.77 EV/EBITDA: 7.73
Market Cap: $988.92M Avg. Daily Volume: 362,556 52 Week Range: $28.31 – $40.06

4. Century Bancorp Inc. (CNBKA): $21.48

Director Marshall Sloane acquired 25,761 shares of this regional bank, paying $21.5 per share for a total amount of $553,862. This Massachusetts based bank has a TAR of 8.1 and had $2.35 billion in assets as of March 2010. It is interesting to see that this bank is trading below book value.

P/E: 9.4 Forward P/E: 9.22 Industry P/E: 15.46
P/S: 1.96 Price/Book: 0.83 EV/EBITDA: N/A
Market Cap: $118.78M Avg. Daily Volume: 10,386 52 Week Range: $16.77 – $25

5. CA Technologies (CA): $19.56

Director Renato Zambonini acquired 25,000 shares of this IT services company paying $19.39 per share for a total amount of $484,717.

P/E: 12.85 Forward P/E: 9.73 Industry P/E: 23.36
P/S: 2.27 Price/Book: 1.94 EV/EBITDA: 5.7
Market Cap: $10.09B Avg. Daily Volume: 6,051,820 52 Week Range: $17.8 – $24.15

Another insider purchase worth mentioning is the purchase of 6,100 shares for $453,347 by the Chief Scientific Officer of Laboratory Corp of America (LH).

Notable Insider Sales:

1. Nxstage Medical, Inc. (NXTM): $15.79

Director David S Utterberg sold 715,000 shares for $15.84, generating $11.32 million from the sale. Director Philippe Chambon sold 383,473 shares for $16.83, generating $6.54 million from the sale. Two other directors also sold stock last week but those sales were options related sales.

P/E: N/A Forward P/E: N/A Industry P/E: 17.87
P/S: 4.64 Price/Book: 9.6 EV/EBITDA: -82.88
Market Cap: $766.70M Avg. Daily Volume: 354,611 52 Week Range: $5.25 – $17.28

2. Informatica Corporation (INFA): $30.13

EVP Worldwide Sales, Paul J Hoffman, sold 215,264 shares for $30.25 per share, generating $6.51 million from the sale. Two other directors also sold stock but those were once again options related sales.

P/E: 43.29 Forward P/E: 23.72 Industry P/E: 23.59
P/S: 4.88 Price/Book: 5.2 EV/EBITDA: 19.95
Market Cap: $2.76B Avg. Daily Volume: 1,600,540 52 Week Range: $17.2 – $31.42

3. Core Laboratories NV (CLB): $77.25

Chief Executive Officer David Demshur sold 133,683 shares of this oil & gas equipment and services provider for $76.07 per share, generating $7.61 million from the sale. Director Joseph Perna sold 33,683 shares for $78.44 per share generating, $2.64 million from the sale.

P/E: 30.11 Forward P/E: 21.34 Industry P/E: 23.23
P/S: 4.95 Price/Book: 14.23 EV/EBITDA: 15.9
Market Cap: $3.70B Avg. Daily Volume: 603,033 52 Week Range: $41.48 – $83.99

4. Red Hat, Inc. (RHT): $32.15

EVP, Engineering Paul J Cormier sold 240,353 shares of this open source software provider for $33 per share, generating $7.93 million from the sale. I can still recollect looking at Red Hat stock when it was trading around $4 in 2001 after the tech bubble burst and hesitating pulling the trigger.

P/E: 66.98 Forward P/E: 36.95 Industry P/E: 23.36
P/S: 7.72 Price/Book: 5.47 EV/EBITDA: 31.81
Market Cap: $6.07B Avg. Daily Volume: 2,981,560 52 Week Range: $20.58 – $33.64

5. Apollo Group Inc. (APOL): $46.13

Apollo makes it to our list for a third week in a row. Vice Chairman of the Board Peter V Sperling sold 150,000 shares of this for-profit education company (Apollo is the parent company of the widely recognized University of Phoenix) for $48.72 per share, generating $7.31 million from the sale. Director Sue Redman sold 2,015 shares for $50 per share, generating $100,750 from the sale.

P/E: 11.82 Forward P/E: 8.24 Industry P/E: 20.03
P/S: 1.46 Price/Book: 5.01 EV/EBITDA: 4.25
Market Cap: $6.81B Avg. Daily Volume: 3,676,690 52 Week Range: $41.45 – $76.86

Contributing author: Ann Kumar

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Merger Arbitrage Mondays – July 26, 2010

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July 25, 2010 | Merger Arbitrage | Author Asif

The activity on the Merger Arbitrage front dropped a little last week with three new deals announced and two deals closing.

The new deals include the acquisition of AmeriCredit Corporation (ACF) by General Motors at $24.50 per share in cash, the acquisition of Cypress Bioscience (CYPB) by hedge fund Ramius at $4.00 per share in cash and the acquisition of ATC Technology (ATAC) by Genco at $25 per share in cash. We have not listed the acquisition of CYPB by Ramius in the table below because the deal is yet to be approved by the Cypress board.

The deals that closed include the acquisition of Arena Resources (ARD) by SandRidge Energy on July 19, 2010 and the acquisition of SonicWall (SNWL) by an investment group led by private equity investment firm Thoma Bravo LLC on July 23, 2010. The tender offers for Santander Bancorp (SBP) and American Italian Pasta Company (AIPC) are now complete and those deals are expected to close shortly.

  Symbol Announced
Date
Acquiring
Company
Closing
Value
Closing
Price
Last
Price
Closing
Date
Profit Annu.

Profit

+ WX 04/26/2010 Charles River Laboratories (CRL) $1.6 billion $20.54 $15.74 12/31/2010 30.48% 70.41%
+ EMMS 05/25/2010 JS Acquisition and Alden Global Capital (N/A) $3 billion $2.40 $1.97 09/30/2010 21.83% 120.71%
+ TLCR 06/07/2010 Grifols (GRF.MC) $3.4 billion $25.89 $21.66 12/31/2010 19.53% 45.11%
+ SSE 02/23/2010 Naugatuck Valley Financial Corp (NVSL) $19.5 million $7.25 $6.35 08/16/2010 14.17% 246.34%
+ AYE 02/11/2010 FirstEnergy (FE) $8.5 billion $25.24 $23.08 03/31/2011 9.36% 13.77%
+ BGH 06/11/2010 Buckeye Partners LP (BPL) $1.14 billion $44.53 $41.54 12/31/2010 7.19% 16.62%
+ ATBC 05/10/2010 Jacksonville Bancorp (JAXB) N/A $2.45 $2.31 09/30/2010 6.06% 33.52%
+ PINN 02/24/2010 Investor Group lead by Scotia Waterous (USA) (N/A) $11 million $0.34 $0.321 08/21/2010 5.92% 83.09%
+ Q 04/22/2010 Century Link (CTL) $10.6 billion $5.92 $5.64 04/21/2011 4.91% 6.67%
+ TTIL 06/09/2010 Teoco Corp. (N/A) $58 million $3.00 $2.88 09/30/2010 4.17% 23.04%
+ ALOY 06/24/2010 ZelnickMedia (N/A) $126.5 million $9.80 $9.43 12/31/2010 3.92% 9.06%
+ ATAC 07/19/2010 Genco Distribution System Inc. (N/A) $513 million $25.00 $24.16 12/31/2010 3.48% 8.03%
+ PRPX 02/17/2010 L.B. Foster Co. (FSTR) $112 million $11.71 $11.35 08/31/2010 3.17% 32.16%
+ TSFG 05/17/2010 TD Bank Financial Group (N/A) $61 million $0.28 $0.2716 09/30/2010 3.09% 17.10%
+ ODSY 05/24/2010 Gentiva Health Services (GTIV) $1.0 billion $27.00 $26.23 09/30/2010 2.94% 16.23%
+ PMACA 06/10/2010 Old Republic International (ORI) $228 million $6.95 $6.75 09/30/2010 2.91% 16.10%
+ GLG 05/17/2010 Man Group (N/A) $1.6 billion $4.50 $4.38 09/30/2010 2.74% 15.15%
+ HEW 07/12/2010 Aon Corp (AON) $4.9 billion $48.91 $47.63 11/15/2010 2.68% 8.74%
+ ECLP 06/09/2010 Allscripts-Misys Healthcare (MDRX) $1.3 billion $19.43 $18.93 11/15/2010 2.63% 8.57%
+ WMZ 05/24/2010 Williams Partners L.P. (WPZ) $35.48 $34.57 09/30/2010 2.63% 14.52%
+ VETS 06/02/2010 VCA Antech Inc (WOOF) $41.25 million $0.34 $0.3325 09/30/2010 2.26% 12.47%
+ PSYS 05/17/2010 Universal Health (N/A) $3.1 billion $33.75 $33.07 12/31/2010 2.06% 4.75%
+ EFJI 05/17/2010 Francisco Partners (N/A) N/A $1.50 $1.47 09/30/2010 2.04% 11.29%
+ ACF 07/22/2010 General Motors Co. (N/A) $3.5 billion $24.50 $24.01 12/31/2010 2.04% 4.71%
+ OMNI 06/04/2010 Wellspring Capital Management (N/A) $122 million $2.75 $2.70 11/15/2010 1.85% 6.04%
+ SMTB 07/15/2010 People's United Financial Inc. (PBCT) $60 million $4.01 $3.941 12/31/2010 1.73% 3.99%
+ WAIN 06/29/2010 Eastern Bank (N/A) $163 million $19.00 $18.6901 12/31/2010 1.66% 3.83%
+ DIVX 06/02/2010 Sonic Solutions (SNIC) $323 million $8.06 $7.93 09/30/2010 1.61% 8.88%
+ ADCT 07/13/2010 Tyco Electronics (TEL) $1.24 billion $12.75 $12.56 12/31/2010 1.51% 3.49%
+ NTY 07/15/2010 The Carlyle Group (N/A) $3.8 billion $55.00 $54.19 12/31/2010 1.49% 3.45%
+ SWWC 03/03/2010 Institutional Investors (N/A) $275 million $11.00 $10.84 03/31/2011 1.48% 2.17%
+ MIR 04/12/2010 RRI Energy In. (RRI) $1.6 billion $11.94 $11.77 12/31/2010 1.40% 3.25%
+ NYM 07/15/2010 ProSight (N/A) $230 million $25.75 $25.40 12/31/2010 1.38% 3.18%
+ BNE 02/24/2010 RR Donnelley (RRD) $481 million $11.50 $11.35 09/30/2010 1.32% 7.31%
+ ME 04/15/2010 Apache (APA) $2.7 billion $23.61 $23.33 09/30/2010 1.22% 6.74%
+ STBK 03/18/2010 Roma Financial Corp (ROMA) $14.7 million $2.52 $2.49 08/16/2010 1.20% 20.94%
+ MAM 03/12/2010 Emera Inc (N/A) $75.7 million $45.00 $44.48 12/31/2010 1.17% 2.70%
+ BSMD 05/13/2010 Merit Medical Systems (MMSI) $96 million $4.38 $4.33 09/30/2010 1.15% 6.39%
+ PFWD 04/16/2010 Oracle Corp. (ORCL) $685 million $17.00 $16.82 06/30/2010 1.07% 0.00%
+ LSBX 07/15/2010 People's United Financial Inc. (PBCT) $96 million $21.00 $20.79 12/31/2010 1.01% 2.33%
+ QUOT 06/11/2010 LQ Acquisition (N/A) $19 million $4.00 $3.96 09/30/2010 1.01% 5.59%
+ ACAP 07/08/2010 The Doctors Company (N/A) $386 million $41.50 $41.11 12/31/2010 0.95% 2.19%
+ CRN 04/19/2010 GeoGroup (GEO) $685 million $28.17 $27.97 09/30/2010 0.72% 3.97%
+ SII 02/19/2010 Schlumberger (SLB) $7.5 billion $41.34 $41.06 09/30/2010 0.69% 3.81%
+ WEL 04/09/2010 Halliburton Company (HAL) $240 million $3.00 $2.98 09/30/2010 0.67% 3.71%
+ MEND 07/12/2010 Johnson & Johnson (JNJ) $480 million $23.40 $23.25 09/30/2010 0.65% 3.57%
+ RBI 03/15/2010 affiliate of Oncap Management Partners L.P. (N/A) $13.55 $13.48 08/16/2010 0.52% 9.03%
+ MDNU 06/11/2010 Danone (N/A) $62.3 million $4.00 $3.98 09/30/2010 0.50% 2.78%
+ ORCD 03/16/2010 eMusic (N/A) $12.77 million $2.05 $2.04 08/16/2010 0.49% 8.52%
+ NADX 04/05/2010 GDC Holdings Inc. (N/A) $100 million $17.00 $16.93 09/30/2010 0.41% 2.29%
+ RCNI 03/05/2010 ABRY Partners (N/A) $536 million $15.00 $14.94 09/30/2010 0.40% 2.22%
+ GNA 06/02/2010 Gerdau (GGB) $1.7 billion $11.00 $10.96 08/31/2010 0.36% 3.70%
+ VRAD 05/17/2010 Providence Equity (N/A) $294 million $17.25 $17.20 09/30/2010 0.29% 1.61%
+ VTIV 05/06/2010 Thomas H. Lee Partners (N/A) $1.1 billion $26.00 $25.93 09/30/2010 0.27% 1.49%
+ SXE 05/07/2010 CGI Group (N/A) $904 million $37.50 $37.40 09/30/2010 0.27% 1.48%
+ ATSI 04/29/2010 Medtronic (MDT) $350 million $4.00 $3.99 09/30/2010 0.25% 1.39%
+ SMTS 06/16/2010 Covidien (COV) $299 million $25.00 $24.97 07/31/2010 0.12% 8.77%
+ IDC 05/04/2010 Silver Lake & Warburg Pincus (N/A) $3.4 billion $33.86 $33.82 09/30/2010 0.12% 0.65%
+ SY 05/12/2010 SAP (SAP) $5.8 billion $65.00 $64.96 09/30/2010 0.06% 0.34%
+ STST 06/30/2010 Boeing (BA) $775 million $34.50 $34.49 09/30/2010 0.03% 0.16%
+ VIRL 06/10/2010 Synopsys (SNPS) $315 million $12.00 $12.00 12/31/2010 0.00% 0.00%
+ AIPC 06/21/2010 Ralcorp Holdings (RAH) $1.2 billion $53.00 $53.01 09/30/2010 -0.02% -0.10%
+ CAL 05/03/2010 United (UAUA) $1.2 billion $24.11 $24.25 12/31/2010 -0.59% -1.35%
+ SBP 06/24/2010 ABLASA (N/A) N/A $12.69 $12.77 07/29/2010 -0.63% -76.22%
+ NGA 04/01/2010 AZZ Inc. (AZZ) $125.6 million $7.50 $7.56 08/31/2010 -0.79% -8.05%
+ VRX 06/21/2010 Biovail Corporation (BVF) $3.3 billion $54.70 $55.32 12/31/2010 -1.12% -2.58%
+ CPII 05/10/2010 Comtech (CMTL) $472.3 million $13.90 $14.08 09/30/2010 -1.25% -6.89%
+ ABII 06/30/2010 Celgene (CELG) $2.9 billion $71.80 $74.42 12/31/2010 -3.51% -8.12%
+ BXC 07/22/2010 Cerberus Capital Management (N/A) $111.1 million $3.40 $3.91 12/31/2010 -13.04% -30.13%
+ DTG 04/26/2010 Hertz (HTZ) $1.3 billion $39.88 $47.57 12/31/2010 -16.17% -37.35%
+ MCCC 06/01/2010 Chief Executive Rocco Commisso (N/A) $590 million $6.00 $7.26 N/A -17.36% 0.00%
+ CCE 02/25/2010 The Coca-Cola Company (KO) $12.3 billion N/A $28.51 10/01/2010 N/A N/A

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Insider Weekends – July 23, 2010

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July 25, 2010 | Insider Buying | Author Asif

Welcome to the seventh edition of Insider Weekends. Insider buying fell more than 50% last week when compared to the week prior and is now at its lowest level since we started collecting this information in the last week of April. Insiders purchased just $3.4 million of their stock last week while selling picked up pace with insiders selling $335.55 million worth of stock.

Sell/Buy Ratio:

The insider Sell/Buy ratio is calculated by dividing the total insider sales in a given week by total insider buying in that week. The adjusted ratio for last week spiked to 98.64. In other words, insiders sold almost 99 times as much stock as they purchased. A large part of this was driven by sales of AutoZone by famous hedge fund manager Edward (Eddie) Lampert and his fund ESL Partners. While we normally exclude fund sales, Mr. Lampert also happens to be a 10% owner and sold a number of these shares directly. Removing the AutoZone sales drops the ratio to 51.13.

The Sell/Buy ratio this week compares unfavorably with the week prior when the ratio stood at 49.07. We are calculating an adjusted ratio by removing transactions by funds and companies and trying as best as possible only to retain information about insiders and 10% owners who are not funds or companies.

Notable Insider Buys:

1. Agilysys Inc. (AGYS): $7.67

Director Andrew Cueva acquired 116,152 shares of this IT services provider through his fund MAK Capital, paying $7.16 per share for a total amount of $831,560. This is the fifth week Agilysys has made our list.

P/E: 49.81 Forward P/E: 22.56 Industry P/E: 21.17
P/S: 0.26 Price/Book: 0.84 EV/EBITDA: 16.81
Market Cap: $175.92M Avg. Daily Volume: 175,664 52 Week Range: $4.4 – $12.5

2. FTI Consulting, Inc. (FCN): $35.8

Director James Crownover acquired 1,000 shares of this business advisory company, paying $33.8 per share for a total amount of $33,795. EVP & Chief Operating Officer Dominic Dinapoli also acquired 5,000 shares, paying $34.61 per share for a total amount of $173,045. Director Gerard E Holthaus acquired 2,850 shares, paying $35.05 per share for a total amount of $99,879. FTI Consulting was on our list last week as well after the CEO and Chairman of the Board both acquires shares.

P/E: 14.78 Forward P/E: 12.39 Industry P/E: 20.78
P/S: 1.18 Price/Book: 1.48 EV/EBITDA: 6.77
Market Cap: $1.68B Avg. Daily Volume: 959,473 52 Week Range: $30.78 – $56.41

3. General Mills Inc. (GIS): $35.52

EVP, Gen Counsel, Chief Compliance & Risk, Roderick A Palmore acquired 6,747 shares of this branded food manufacturer, paying $35.6 per share for a total amount of $240,193.

P/E: 15.86 Forward P/E: 13.11 Industry P/E: 15.94
P/S: 1.56 Price/Book: 4.3 EV/EBITDA: 9.39
Market Cap: $23.13B Avg. Daily Volume: 6,506,720 52 Week Range: $28.55 – $38.98

4. Piper Jaffray Companies (PJC): $29.6

Chairman & CEO Andres S Duff also acquired 5,000 shares of this investment bank and asset management company, paying $28.19 per share for a total amount of $140,942. Chief Administrative Officer Ronald T Firebaugh acquired 3,500 shares, paying $28.09 for a total amount of $98,315.

P/E: 16.92 Forward P/E: 11.94 Industry P/E: 17.1
P/S: 1.19 Price/Book: 0.54 EV/EBITDA: N/A
Market Cap: $614.44M Avg. Daily Volume: 197,050 52 Week Range: $26.84 – $57.8

5. H&R Block, Inc. (HRB): $15.23

Director Christianna Wood acquired 9,713 shares of this tax preparation company, paying $14.82 per share for a total amount of $143,932.

P/E: 10.64 Forward P/E: 8.46 Industry P/E: 13.18
P/S: 1.26 Price/Book: 3.38 EV/EBITDA: 4.33
Market Cap: $4.92B Avg. Daily Volume: 4,734,430 52 Week Range: $13.44 – $23.23

Notable Insider Sales:

1. AutoZone Inc. (AZO): $207.00

Director William Crowley sold 2,151 shares of this auto parts retailer both directly and through his company Tynan LLC, at an average price of $207.13, generating $445,532 from the sale. 10% owner Edward Lampert (of Sears Holdings fame) sold 778,195 shares both directly and through his fund ESL Partners, at an average price of $207.13, generating $161.19 million from the sale.

P/E: 14.87 Forward P/E: 12.55 Industry P/E: 19.89
P/S: 1.36 Price/Book: N/A EV/EBITDA: 8.49
Market Cap: $9.73B Avg. Daily Volume: 641,356 52 Week Range: $135.13 – $208.2

2. Apollo Group Inc. (APOL): $49.27

Vice Chairman of the Board Peter Sperling sold 100,000 shares of this for-profit education company (Apollo is the parent company of the widely recognized University of Phoenix) for $47.67, generating $4.77 million from the sale. Apollo was also on our list last week when Mr. Sperling sold 250,000 shares for a total amount of $10.95 million.

P/E: 12.63 Forward P/E: 8.8 Industry P/E: 19.01
P/S: 1.44 Price/Book: 4.93 EV/EBITDA: 4.57
Market Cap: $7.27B Avg. Daily Volume: 3,688,950 52 Week Range: $41.45 – $76.86

3. Emergent BioSolutions, Inc. (EBS): $19.23

CEO and Chairman Fuad El-Hibri sold 233,333 shares of this biotech company for an average selling price of $18.43, generating $4.3 million from the sale.

P/E: 26.75 Forward P/E: 18.31 Industry P/E: 15.11
P/S: 2.72 Price/Book: 2.38 EV/EBITDA: 14
Market Cap: $596.90M Avg. Daily Volume: 238,061 52 Week Range: $12.36 – $19.95

4. National Instruments Corporation (NATI): $32.00

President James Truchard sold 80,500 shares of this application software and hardware company for an average selling price of $31.79, generating $2.56 million from the sale. Director Jeffrey Kodosky sold 12,000 shares for $30.52, generating $376,200 from the sale.

P/E: 71.43 Forward P/E: 20.25 Industry P/E: 27.88
P/S: 3.46 Price/Book: 3.73 EV/EBITDA: 22.68
Market Cap: $2.48B Avg. Daily Volume: 251,758 52 Week Range: $23.91 – $36.98

5. iGATE Corporation (IGTE):$17.43

President and CEO Phaneesh Murthy sold 100,000 at an average selling price of $17.07, generating $1.71 million from the sale. Director Gordon Garrett sold 16,576 shares for $17.14, generating $284,067 from the sale. VP & Regional Manager – Canada Jason Trussell sold 11,825 shares for $16.99, generating $200,943 from the sale. Chief Delivery Officer – IT Services Suresh Sean Narayanan sold 9,274 shares for $17.01, generating $157,778. CFO Sujit Sircar sold 8,856 shares for $17.21, generating $152,387 from the sale.

P/E: 24.62 Forward P/E: 18.35 Industry P/E: 21.17
P/S: 4.25 Price/Book: 4.52 EV/EBITDA: 17.25
Market Cap: $972.77M Avg. Daily Volume: 275,100 52 Week Range: $6.31 – $17.75

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Merger Arbitrage Mondays – July 19, 2010

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July 18, 2010 | Merger Arbitrage | Author Asif

Mergers activity bounced back sharply last week with five new deals announced and three deals closing.

The founder of Playboy (PLA) Hugh Hefner made a bid to take the company private is a deal valued at $185 million and is now fighting a competing bid from Penthouse magazine, which has bid $210 million for the company. Since the board is still considering both offers, we have not included the deal in our merger arbitrage table below.

The new deals include the acquisition of Micrus Endovascular (MEND) by Johnson & Johnson (JNJ) for $23.40 per share in an all cash deal, the acquisition of Hewitt Associates (HEW) by Aon (AON) in a cash plus stock deal consisting of $25.61 in cash and 0.6362 in Aon stock, the acquisition of ADC Telecommunication (ADCT) by Tyco Electronics (TEL) for $12.75 per share in an all cash deal, the acquisition of NYMagic (NYM) by ProSight for $25.75 per share in an all cash deal and the acquisition of NBTY (NTY) by The Carlyle Group at $55 per share in an all cash deal.

The deals that closed include the acquisition of CKE Restaurants by an affiliate of Apollo Management,  the acquisition of ev3 by Covidien on July 12, 2010 and the acquisition of Millipore by Merck on July 15, 2010.

If you are new to merger arbitrage, please feel free to check out our introduction to merger arbitrage here. You can also use our automated merger arbitrage tool that constantly updates the profits and annualized profits for all pending deals during market hours.

  Symbol Announced
Date
Acquiring
Company
Closing
Value
Closing
Price
Last
Price
Closing
Date
Profit Annu.

Profit

+ WX 04/26/2010 Charles River Laboratories (CRL) $1.6 billion $20.44 $15.73 12/31/2010 29.91% 66.17%
+ TLCR 06/07/2010 Grifols (GRF.MC) $3.4 billion $26.07 $21.31 12/31/2010 22.35% 49.44%
+ SSE 02/23/2010 Naugatuck Valley Financial Corp (NVSL) $19.5 million $7.25 $6.40 08/16/2010 13.28% 173.13%
+ EMMS 05/25/2010 JS Acquisition and Alden Global Capital (N/A) $3 billion $2.40 $2.14 09/30/2010 12.15% 60.75%
+ AYE 02/11/2010 FirstEnergy (FE) $8.5 billion $24.75 $22.30 03/31/2011 11.00% 15.74%
+ BGH 06/11/2010 Buckeye Partners LP (BPL) $1.14 billion $43.29 $40.154 12/31/2010 7.80% 17.26%
+ PINN 02/24/2010 Investor Group lead by Scotia Waterous (USA) (N/A) $11 million $0.34 $0.32 08/21/2010 6.25% 69.13%
+ Q 04/22/2010 Century Link (CTL) $10.6 billion $5.75 $5.44 04/21/2011 5.77% 7.64%
+ DIVX 06/02/2010 Sonic Solutions (SNIC) $323 million $7.38 $7.0275 09/30/2010 5.00% 25.00%
+ PRPX 02/17/2010 L.B. Foster Co. (FSTR) $112 million $11.71 $11.22 08/31/2010 4.37% 37.07%
+ ALOY 06/24/2010 ZelnickMedia (N/A) $126.5 million $9.80 $9.40 12/31/2010 4.26% 9.41%
+ TTIL 06/09/2010 Teoco Corp. (N/A) $58 million $3.00 $2.88 09/30/2010 4.17% 20.83%
+ EFJI 05/17/2010 Francisco Partners (N/A) N/A $1.50 $1.45 09/30/2010 3.45% 17.24%
+ PMACA 06/10/2010 Old Republic International (ORI) $228 million $6.92 $6.70 09/30/2010 3.27% 16.34%
+ GLG 05/17/2010 Man Group (N/A) $1.6 billion $4.50 $4.36 09/30/2010 3.21% 16.06%
+ ECLP 06/09/2010 Allscripts-Misys Healthcare (MDRX) $1.3 billion $20.12 $19.52 11/15/2010 3.09% 9.49%
+ VETS 06/02/2010 VCA Antech Inc (WOOF) $41.25 million $0.34 $0.3301 09/30/2010 3.00% 15.00%
+ NTY 07/15/2010 The Carlyle Group (N/A) $3.8 billion $55.00 $53.45 12/31/2010 2.90% 6.41%
+ HEW 07/12/2010 Aon Corp (AON) $4.9 billion $48.67 $47.30 11/15/2010 2.89% 8.86%
+ MAM 03/12/2010 Emera Inc (N/A) $75.7 million $45.00 $43.85 12/31/2010 2.62% 5.80%
+ PSYS 05/17/2010 Universal Health (N/A) $3.1 billion $33.75 $32.90 12/31/2010 2.58% 5.72%
+ ATBC 05/10/2010 Jacksonville Bancorp (JAXB) N/A $2.59 $2.53 09/30/2010 2.53% 12.65%
+ SWWC 03/03/2010 Institutional Investors (N/A) $275 million $11.00 $10.74 03/31/2011 2.42% 3.47%
+ MIR 04/12/2010 RRI Energy In. (RRI) $1.6 billion $10.97 $10.72 12/31/2010 2.35% 5.19%
+ OMNI 06/04/2010 Wellspring Capital Management (N/A) $122 million $2.75 $2.69 11/15/2010 2.23% 6.84%
+ BNE 02/24/2010 RR Donnelley (RRD) $481 million $11.50 $11.26 09/30/2010 2.13% 10.66%
+ ME 04/15/2010 Apache (APA) $2.7 billion $21.90 $21.45 09/30/2010 2.11% 10.56%
+ WAIN 06/29/2010 Eastern Bank (N/A) $163 million $19.00 $18.65 12/31/2010 1.88% 4.15%
+ ADCT 07/13/2010 Tyco Electronics (TEL) $1.24 billion $12.75 $12.52 12/31/2010 1.84% 4.06%
+ TSFG 05/17/2010 TD Bank Financial Group (N/A) $61 million $0.28 $0.275 09/30/2010 1.82% 9.09%
+ ACAP 07/08/2010 The Doctors Company (N/A) $386 million $41.50 $40.77 12/31/2010 1.79% 3.96%
+ NYM 07/15/2010 ProSight (N/A) $230 million $25.75 $25.31 12/31/2010 1.74% 3.85%
+ ODSY 05/24/2010 Gentiva Health Services (GTIV) $1.0 billion $27.00 $26.5575 09/30/2010 1.67% 8.33%
+ WMZ 05/24/2010 Williams Partners L.P. (WPZ) $34.29 $33.82 09/30/2010 1.40% 7.02%
+ WEL 04/09/2010 Halliburton Company (HAL) $240 million $3.00 $2.96 09/30/2010 1.35% 6.76%
+ PFWD 04/16/2010 Oracle Corp. (ORCL) $685 million $17.00 $16.79 06/30/2010 1.25% 0.00%
+ STBK 03/18/2010 Roma Financial Corp (ROMA) $14.7 million $2.52 $2.49 08/16/2010 1.20% 15.71%
+ VIRL 06/10/2010 Synopsys (SNPS) $315 million $12.00 $11.88 12/31/2010 1.01% 2.23%
+ RCNI 03/05/2010 ABRY Partners (N/A) $536 million $15.00 $14.87 09/30/2010 0.87% 4.37%
+ MEND 07/12/2010 Johnson & Johnson (JNJ) $480 million $23.40 $23.20 09/30/2010 0.86% 4.31%
+ SII 02/19/2010 Schlumberger (SLB) $7.5 billion $39.48 $39.15 09/30/2010 0.85% 4.26%
+ VTIV 05/06/2010 Thomas H. Lee Partners (N/A) $1.1 billion $26.00 $25.80 09/30/2010 0.78% 3.88%
+ MDNU 06/11/2010 Danone (N/A) $62.3 million $4.00 $3.97 09/30/2010 0.76% 3.78%
+ ATSI 04/29/2010 Medtronic (MDT) $350 million $4.00 $3.97 09/30/2010 0.76% 3.78%
+ BSMD 05/13/2010 Merit Medical Systems (MMSI) $96 million $4.38 $4.35 09/30/2010 0.69% 3.45%
+ RBI 03/15/2010 affiliate of Oncap Management Partners L.P. (N/A) $13.55 $13.46 08/16/2010 0.67% 8.72%
+ DBTK 05/17/2010 Vision Solutions (N/A) $242 million $10.55 $10.48 09/30/2010 0.67% 3.34%
+ IDC 05/04/2010 Silver Lake & Warburg Pincus (N/A) $3.4 billion $33.86 $33.67 09/30/2010 0.56% 2.82%
+ GNA 06/02/2010 Gerdau (GGB) $1.7 billion $11.00 $10.94 08/31/2010 0.55% 4.66%
+ NADX 04/05/2010 GDC Holdings Inc. (N/A) $100 million $17.00 $16.91 09/30/2010 0.53% 2.66%
+ QUOT 06/11/2010 LQ Acquisition (N/A) $19 million $4.00 $3.98 09/30/2010 0.50% 2.51%
+ ORCD 03/16/2010 eMusic (N/A) $12.77 million $2.05 $2.04 08/16/2010 0.49% 6.39%
+ CRN 04/19/2010 GeoGroup (GEO) $685 million $27.39 $27.26 09/30/2010 0.48% 2.40%
+ SNWL 06/03/2010 investor group led by private equity firm Thoma Bravo LLC (N/A) $636 million $11.50 $11.45 12/31/2010 0.44% 0.97%
+ CPII 05/10/2010 Comtech (CMTL) $472.3 million $15.95 $15.89 09/30/2010 0.37% 1.87%
+ VRAD 05/17/2010 Providence Equity (N/A) $294 million $17.25 $17.20 09/30/2010 0.29% 1.45%
+ STST 06/30/2010 Boeing (BA) $775 million $34.50 $34.40 09/30/2010 0.29% 1.45%
+ SXE 05/07/2010 CGI Group (N/A) $904 million $37.50 $37.40 09/30/2010 0.27% 1.34%
+ SY 05/12/2010 SAP (SAP) $5.8 billion $65.00 $64.83 09/30/2010 0.26% 1.31%
+ SMTS 06/16/2010 Covidien (COV) $299 million $25.00 $24.94 07/31/2010 0.24% 7.32%
+ SBP 06/24/2010 ABLASA (N/A) N/A $12.69 $12.66 07/22/2010 0.24% 28.83%
+ CYBS 04/21/2010 Visa Inc. (V) $2.0 billion $26.00 $25.96 09/30/2010 0.15% 0.77%
+ AIPC 06/21/2010 Ralcorp Holdings (RAH) $1.2 billion $53.00 $52.94 09/30/2010 0.11% 0.57%
+ NGA 04/01/2010 AZZ Inc. (AZZ) $125.6 million $7.50 $7.50 08/31/2010 0.00% 0.00%
+ VRX 06/21/2010 Biovail Corporation (BVF) $3.3 billion $53.26 $53.58 12/31/2010 -0.60% -1.32%
+ CAL 05/03/2010 United (UAUA) $1.2 billion $22.42 $22.86 12/31/2010 -1.94% -4.28%
+ ABII 06/30/2010 Celgene (CELG) $2.9 billion $71.62 $74.37 12/31/2010 -3.70% -8.18%
+ ARD 04/04/2010 SandRidge Energy Inc. (SD) $1.6 billion $33.93 $35.98 09/30/2010 -5.69% -28.44%
+ MCCC 06/01/2010 Chief Executive Rocco Commisso (N/A) $590 million $6.00 $6.73 N/A -10.85% 0.00%
+ DTG 04/26/2010 Hertz (HTZ) $1.3 billion $39.19 $46.22 12/31/2010 -15.22% -33.67%
+ CCE 02/25/2010 The Coca-Cola Company (KO) $12.3 billion N/A $27.69 10/01/2010 N/A N/A

Voluntary Disclosure: I own positions in Coca-Cola Enterprises (CCE) and Portec Rail Products (PRPX).

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Insider Weekends – July 16, 2010

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July 17, 2010 | Insider Buying | Author Asif

Welcome to the sixth edition of Insider Weekends. Insider buying fell to its lowest level since we started collecting this information in the last week of April. Insiders purchased just $6.45 million of their stock last week while selling picked up pace with insiders selling $316.4 million worth of stock. We removed a very large $100 million transaction both on the buy side and the sell side for movie theater company Regal Entertainment Group (RGC) as it was simply a transfer of stock and not actual insider buying or selling.

Sell/Buy Ratio:

The insider Sell/Buy ratio is calculated by dividing the total insider sales in a given week by total insider buying in that week. The adjusted ratio for last week jumped up to 49.07. In other words, insiders sold almost 49 times as much stock as they purchased. This compares unfavorably with the week prior when the ratio stood at 32.90 and just 2.55 the week before that. We are calculating an adjusted ratio by removing transactions by funds and trying as best as possible only to retain information about insiders and 10% owners who are not funds.

Notable Insider Buys Last Week:

1. Monsanto Company (MON) $56.20

Chairman, President & CEO, Hugh Grant acquired 37,500 shares of this Agricultural Products Company, paying $52.06 per share for a total amount of $1.95 million. EVP and CFO Carl Casale also acquired 30,000 shares, paying $52.09 per share for a total amount of $1.56 million.

Key Statistics:

P/E: 30.46 Forward P/E: 18.73 Industry P/E: 15.97
P/S: 2.90 Price/Book: 2.86 EV/EBITDA: 11.95
Market Cap: $30.37 billion Avg. Daily Volume: 9,752,290 52 Week Range: $44.61 – $87.28

2. Luby’s Inc. (LUB) $4.91

Chief Operating Officer, Harris J. Pappas acquired 88,134 shares of this Texas based restaurant operator, paying $4.95 per share, for a total amount of $436,263. President & CEO Christopher James Pappas also acquired 88,134 shares, paying $4.95 per share, for a total amount of $436,263. Luby’s recently acquired the assets of Fuddruckers for $61 million in cash after Fuddruckers filed for bankruptcy.

Key Statistics:

P/E: N/A Forward P/E: 32.73 Industry P/E: 14.86
P/S: 0.49 Price/Book: 0.83 EV/EBITDA: 288.44
Market Cap: $137.74 million Avg. Daily Volume: 122,536 52 Week Range: $3.25 – $5.03

3. FTI Consulting (FCN) $33.62

President & CEO, Jack B Dunn IV acquired 10,000 shares of this business advisory company, paying $33.19 per share for a total amount of $331,895. Chairman of the Board, Dennis J Shaughnessy also acquired 10,000 shares, paying $32.82 per share for a total amount of $328,168.

Key Statistics:

P/E: 13.88 Forward P/E: 11.63 Industry P/E: 20.69
P/S: 1.12 Price/Book: 1.40 EV/EBITDA: 6.45
Market Cap: $1.58 billion Avg. Daily Volume: 953,661 52 Week Range: $30.78 – $56.41

4. Agilysys (AGYS) $6.99

Director Andrew R Cueva acquired 33,971 shares of this IT services provider through his fund MAK Capital, paying $7.21 per share for a total amount of $244,994. This is the fourth week Agilysys has made our list.

Key Statistics:

P/E: 45.39 Forward P/E: 20.56 Industry P/E: 19.46
P/S: 0.27 Price/Book: 0.85 EV/EBITDA:14.45
Market Cap: $160.32 million Avg. Daily Volume: 172,553 52 Week Range: $4.28 – $12.50

5. A. Schulman (SHLM) $18.04

VP – Global Supply Chain & CPO, Gary A Miller acquired 10,000 shares of this plastics supplier, paying $19.13 per share for a total amount of $191,300.

Key Statistics:

P/E: 17.18 Forward P/E: 9.45 Industry P/E: 17.28
P/S: 0.42 Price/Book: 1.22 EV/EBITDA: 7.74
Market Cap: $567.95 million Daily Volume: 277,302 52 Week Range: $16.15 – $27.23

Voluntary Disclosure: I own a long position in Luby’s (LUB).

Notable Insider Sales Last Week:

1. Apollo Group (APOL) $45.57

Vice Chairman of the Board Peter Sterling sold 250,000 shares of this large for-profit education company (Apollo is the parent company of the widely recognized University of Phoenix) for $43.80 per share, for a total amount of $10.95 million.

Key Statistics:

P/E: 11.68 Forward P/E: 8.11 Industry P/E: 19.67
P/S: 1.39 Price/Book: 4.77 EV/EBITDA: 4.19
Market Cap: $6.72 billion Avg. Daily Volume: 3,403,740 52 Week Range: $41.45 – $76.86

2. Fastenal Company (FAST) $47.66

Director Robert A Kierlin sold 150,000 shares of this industrial & construction supplier for $49.84 per share for a total amount of $7.48 million.

Robert Kierlin was Fastenal’s CEO from 1968 through 2002 and has been the Chairman since incorporation. This sale represents a 2% reduction of his overall position.

Key Statistics:

P/E: 32.42 Forward P/E: 21.96 Industry P/E: 22.85
P/S: 3.57 Price/Book: 5.83 EV/EBITDA: 17.45
Market Cap: $7.03 billion Avg. Daily Volume: 1,355,680 52 Week Range: $32.71 – $56.65

3. Capital One Financial Corporation (COF) $41.46

President, Financial Services, Sanjiv Yajnik sold 84,951 shares for $45 per share for a total amount of $3.82 million.

Key Statistics:

P/E: 16.45 Forward P/E: 9.82 Industry P/E: 11.85
P/S: 1.98 Price/Book:0.81 EV/EBITDA: N/A
Market Cap: $18.93 billion Avg. Daily Volume: 7,151,470 52 Week Range: $25.70 – $47.73

4. Guess? Inc. (GES) $32.56

Director, Carlos Alberini sold 113,991 shares of this retail chain for $32.91 per share for a total amount of $3.75 million.

Key Statistics:

P/E: 11.65 Forward P/E: 9.81 Industry P/E: 15.10
P/S: 1.43 Price/Book: 2.99 EV/EBITDA: 5.53
Market Cap: $3.04 billion Avg. Daily Volume: 2,101,710 52 Week Range: $25.85 – $51.28

5. Advent Software Inc. (ADVS) $48.00

CEO Stephanie Dimarco also sold 20,000 shares of this financial software services provider for $49.28 per share for a total amount of $985,582. Director George Battle sold 10,000 shares for $50 per share for a total amount of $500,000.

Key Statistics:

P/E: 36.89 Forward P/E: 30.38 Industry P/E: 24.27
P/S: 4.91 Price/Book: 5.10 EV/EBITDA: 27.56
Market Cap: $1.24 Billion Avg. Daily Volume: 122,555 52 Week Range: $33.18 – $50.20

Patisserie Philippe Fruit TartOn an unrelated note, located right across from Advent Software’s San Francisco headquarters is one of the most delightful little French bakeries I have ever set foot into. Patisserie Philippe has amazing fruit tartelettes, a chocolate banana pastry that is to die for (can’t recollect its name) and their freshly baked large chocolate chip cookies with walnuts tend to sell out early. Definitely worth a visit if you live in the City or happen to visit San Francisco.

Contributing author: Ann Kumar

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