Dear Valued Visitor,

We have noticed that you are using an ad blocker software.

Although advertisements on the web pages may degrade your experience, our business certainly depends on them and we can only keep providing you high-quality research based articles as long as we can display ads on our pages.

To view this article, you can disable your ad blocker and refresh this page or simply login.

We only allow registered users to use ad blockers. You can sign up for free by clicking here or you can login if you are already a member.

Intel Corporation (INTC) and PepsiCo Inc. (PEP) Among Companies with Notable Insider Selling Activity

Although no one knows how many investors pay close attention to insider trading behavior when making investment decisions, there is good reason to believe that a high number of retail investors examine this activity as part of their stock analysis process. It is generally believed that executives and Board members usually sell shares of their companies when they see signs of trouble ahead, but this line of thought seems to be quite outdated. Insider trading watchers should keep in mind that most corporate insiders receive stock-based compensation as part of their compensation packages, which is why insiders sometimes sell shares for personal needs, without taking into account how undervalued or overvalued their companies’ shares are. As most insider sales related to freshly-exercised stock options or incumbent personal needs are conducted under pre-arranged trading plans, investors should mostly look for spur-of-the-moment insider transactions, which are solely the types of trades we report on when covering insider trading activity. With that in mind, Insider Monkey processed numerous Form 4 filings submitted with the SEC on Friday and identified three companies with noteworthy insider sales.

Academic research has shown that certain insider purchases historically outperformed the market by an average of seven percentage points per year. This effect is more pronounced in small-cap stocks. Another exception is the small-cap stock picks of hedge funds. Our research has shown that imitating the 15 most popular small-cap stocks among hedge funds outperformed the market by nearly a percentage point per month between 1999 and 2012 (read more details here).

Intel Corporation Chairman Sells Massive Block of Shares

Intel Corporation (NASDAQ:INTC) had one of its most influential insiders sell shares this past week. Chairman Andy D. Bryant sold 185,740 shares on Thursday at prices varying from $31.93 to $32.05 per share, cutting his direct ownership stake to 386,731 shares. Mr. Bryant also holds an indirect ownership stake of 24,383 shares, which is held by a family trust fund.

The chipmaker is the worst performing stock in the Dow Jones Industrial Index thus far in 2016, so the recent insider selling at the company is not promising at all. Intel’s shares are 8% in the red year-to-date and are down by 3% over the past 12 months. The company’s disappointing first quarter earnings report released at the beginning of last week was overshadowed by a restructuring initiative that involves the reduction of up to 12,000 positions by mid-2017, which represents roughly 11% of the company’s current workforce. The freshly-announced headcount reduction is part of Intel Corporation (NASDAQ:INTC)’s transition towards the cloud and Internet of Things from the fast-declining PC market. Intel dominates the PC market, but fresh statistics show that global PC shipments declined by 11.5% year-over-year in the first quarter of this year. The company anticipates the PC market to decline by a further high-single-digits in 2016, so Intel’s data center and Internet of Things businesses are seen as the primary growth pillars in the years ahead. The company anticipates revenue growth in the mid-single-digits in 2016, down from its previous outlook of mid-to-high-single-digit growth.

Shares of Intel are currently changing hands at around 12.1-times expected earnings, below the forward P/E multiple of 14.3 for the Semiconductors sector. The hedge fund sentiment towards the chipmaker increased in the December quarter, as the number of funds tracked by Insider Monkey with stakes in Intel increased to 56 from 45 quarter-over-quarter. Ken Fisher’s Fisher Asset Management owns 19.63 million shares of Intel Corporation (NASDAQ:INTC) as of March 31.

Follow Intel Corp (NASDAQ:INTC)
Trade (NASDAQ:INTC) Now!

The concluding pages of this article discuss the insider selling registered at Tile Shop Hldgs Inc. (NASDAQ:TTS) and PepsiCo Inc. (NYSE:PEP).

DOWNLOAD FREE REPORT: Warren Buffett's Best Stock Picks

Let Warren Buffett, George Soros, Steve Cohen, and Daniel Loeb WORK FOR YOU.

If you want to beat the low cost index funds by 19 percentage points per year, look no further than our monthly newsletter.In this free report you can find an in-depth analysis of the performance of Warren Buffett's entire historical stock picks. We uncovered Warren Buffett's Best Stock Picks and a way to for Buffett to improve his returns by more than 4 percentage points per year.

Bonus Biotech Stock Pick: You can also find a detailed bonus biotech stock pick that we expect to return more than 50% within 12 months.
Subscribe me to Insider Monkey's Free Daily Newsletter
This is a FREE report from Insider Monkey. Credit Card is NOT required.