Lastest on insider selling of BAMM from TSC:
Silicon Valley: Bam! Insiders File to Sell
Books-A-Million Stock
By Suzanne Galante
Staff Reporter
12/11/98 4:32 PM ET
SAN FRANCISCO -- Following a huge surge in shares of
Books-A-Million (BAMM:Nasdaq) in recent weeks, company
insiders and their family members are lining up to sell
shares-a-million.
Books-A-Million arose from retailing obscurity on Nov. 25, when
it issued a press release to announce its "newly enhanced"
Web site at www.booksamillion.com that the company said
"offers some of the best prices on the Internet for books." Within
three trading days, the stock rose from a low of 4 1/2 to a high of
47. Just three days later, insiders filed to sell $49.3 million worth
of shares, or about a quarter of their holdings in the bookseller.
Books-A-Million's share price has languished below 10 since
June 1996. Since then, insider selling had been quiet until Dec.
3 and 4, when insiders submitted 32 filings with the Securities
and Exchange Commission saying they planned to sell 1.6
million shares of Books-A-Million's stock, according to Edgar
Online. During those two days, the stock was trading between
11 1/2 and 15 1/4.
Books-A-Million was trading at 11 3/8 Friday afternoon, down 6%
from Thursday's close, but still up more than 150% from where
it was when the revamped site was announced.
Insiders owned 6 million shares, or 34% of the company, as of
April 14, according to the company's most recent proxy filing. In
the two days after the company's Internet announcement, the
value of that stake rose from $26 million to $233 million. The 1.6
million shares that insiders and their family members filed to
sell represent 27% of that stake.
Among those cashing in were CFO Sandra Cochran, who
beneficially owns 92,928 shares and exercisable options,
according to CDA Investnet, which tracks insider selling. In the
December filings, Cochran filed to sell 69,928 shares, or about
three-fourths of her shares and exercisable options. In theory, a
CFO should have the clearest view of a company's financial
health, so when a CFO files to sell the vast bulk of his or her
holding, it can raise alarm among investors.
"I wouldn't think that's a very encouraging sign," says Paul Elliott,
a research analyst for CDA Investnet. "It seems that they don't
feel confident that these prices are going to stay where they are
or go higher."
Over the same two-day period, Terrance Finley, the company's
senior vice president, filed to sell 32,400, more than half his
exercisable shares and options. Clyde Anderson,
Books-A-Million's president and CEO, filed to sell 442,300
shares valued at more than $13 million, while Chairman
Charles Anderson filed to sell at least 397,047 shares valued at
nearly $12 million.
Executives and directors at Books-A-Million didn't return
repeated calls for comment.
The 144 filing with the SEC is an intent to sell shares and not an
actual sale. But Elliott says it's extremely rare for an executive or
insider to file a 144 form and not actually sell the shares.
Books-A-Million is one of a group of companies that have seen
their stocks surge after announcing a move toward selling
goods on the Internet. Small investors have pushed the share
prices of companies such as K-Tel (KTEL:Nasdaq) higher in a
matter of days -- or even hours -- in the wake of such news.
"This sector is speculation gone amok," says Elliott. "Since
[insiders] are selling so quickly after the run, they don't see [the
Internet] as the start of something new, something big" like
some analysts have been proposing, he says. "It just doesn't
seem like the insiders are buying that." |
