Unusual Insider Signals at $BKNG, $HOG Amid Downshift in Sentiment

• Overall low participation from insiders in Q3 suggests lack of conviction as they look for more clarity.
• Still, notable activity from Booking Holdings, Harley Davidson, and others.

Insider Sentiment Downshifts Slightly

After sentiment leaned solidly positive in Q2’22, insiders have shifted to a neutral-to-slightly-positive footing in Q3’22 as trading windows opened in August and extended into September.

To get more granular, as equities rebounded off the June lows to a near-term peak in mid-August, buying dwindled some but a notable wave of selling failed to materialize. Overall participation by insiders remains low, suggesting a lack of conviction with many insiders holding off on buying or selling as they look for more clarity.

Putting August in Context

The second month of each quarter is typically the most active as trading windows open and insiders are free to buy and sell, regardless of whether they are using a 10b5-1 plan. So there is a seasonal effect that causes volume to pick up. As activity ramps, we look at how the mix of buying and selling and overall volumes compares to past periods.

During August 2022, sellers outnumbered buyers 2.6 to 1, more positive than the 3.6 to 1 average for our entire database, but less positive than the ratios of 1.5 to 1 and below that we saw in May and June.

Given seasonality, it can be helpful to compare a given month to that month in previous years. Through that lens we can see how low participation has been.

• Seller count overall in August was the lowest for August since 2011.
• Buyer count was the lowest for the month of August since 2016.

September Tilting Positively

So far in September, the activity mix has shifted in a positive direction. Buying volume is moderate while selling volume is unusually low.

Unusual Insider Signals to Note

In an environment like this, we are looking at company-specific stories where insiders are behaving unusually. Throughout the quarter, we have been alerting clients with real-time coverage of unusual insider behavior. Here is a small selection of that coverage from recent weeks.

Uncommon Conviction at Booking Holdings (BKNG)

Chairman Robert Mylod, who previously served as the company’s CFO, bought $3.7M at an average price of ~$1,860.00 in August and early September. The buying showed unusual conviction and represented a deviation in behavior at BKNG, where insider buying has been very uncommon in the past. (9/7/22)

Harley-Davidson (HOG) Insider Sends Compelling Message

CEO Jochen Seitz, who has a very strong track record as a buyer at the motorcycle maker, continued his buy bias with a $1M purchase at $38.94. Zeitz last made a similar-sized buy in February 2021 at $32.47 in a timely move on a dip for the stock. It sends a compelling positive message to see him return at a slightly higher price as the stock has rebounded from lows. (9/7/22)

Extreme Decline in Insider Selling at Cognizant Technologies (CTSH)

Insider selling has dried up at the IT-services provider in an unusual change in behavior that generated our Extreme Cessation of Selling Unusual Event and sends a compelling positive valuation message. Insiders have been consistent sellers at CTSH for more than a decade, so it stands out that none have sold since May. It was the first calendar quarter without selling since Q4’11. Insider selling dwindled in Q2’22 as shares tumbled from an all-time high of $93.47 reached in March. (9/6/22)

First Time for Three Quarterly Buyers at First Solar (FSLR)

Buying has been rare at the solar energy company, so it stands out to see three executives buy at prices above $100.00 as shares have rebounded off lows. It’s the first time there have been three quarterly buyers at the firm since the company’s November 2006 IPO. Chief Commercial Officer Georges Antoun led the activity with a $1M purchase at $100.53 in a reversal in sentiment after he was a seller at lower prices last year. (8/8/22)

About the Data

Data included in this report is sourced by VerityData | InsiderScore‘s comprehensive databases of insider trades, buybacks, at-the-market offerings, management changes, institutional investor disclosures, and more.

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For data inquiries relevant to this report, contact Ben Silverman.