USA Today: Bad sign: Execs sell more stock than they buy
Is this a bearish sigh? ^_^
usatoday.com
By Greg Farrell, USA TODAY
[...]
* The ratio of stock sold by insiders to stock bought jumped in May. For every dollar insiders
spent buying, they sold $34.11. That's more than double the figure for April, $15.98, and
nearly triple the average ratio of 12-to-1.
* The rate of insider buying fell 15% from April to May, from $179.7 million to $152.5 million.
[...]
"Right now, maybe executives don't feel there will be a summer rally," says Lon Gerber,
director of research for Thomson Financial/Lancer Analytics. "We're at the most bearish
point ever."
[...]
David Tice,
portfolio manager at the Prudent Bear fund.
Tice says many people now are hoping that stocks have hit bottom because lower interest
rates are going to help corporate profits. "But Corporate America realizes that it's not the
case, and they're taking money off the table," he says.
And unlike last year, when selling centered on tech companies, analysts point out that
executives at companies across all industries are lightening up now.
But insider selling is only half of what is causing concern.
"There's been a fairly incredible lack of insider buying across the board," says Paul Elliott,
analyst at Thomson Financial/First Call.
But now that shares of most tech companies have hit what appear to be lows, Elliott argues
that there should be an uptick in insider buying. "The lack of buying is starting to be
troubling," he says.
Has the market hit bottom? Not judging from all the people who are saying it has, Tice says.
"There's more discussion of bottoms on CNBC than in a proctologist's office or in Hugh
Hefner's mansion," Tice says. "We're in the eye of a hurricane." |
