Jobs Transcation shows he is bullish on AAPL
Apple Computer (AAPL) CEO and co-founder Steve Jobs has a
history of making theatrical statements with his stock sales. So how do
analysts of insider selling interpret his most recent moves? Jonathan Moreland,
director of research at InsiderInsights.com, for one, sees the move as a sign
of bullishness about Apple from Jobs.
In a Securities and Exchange Commission filing, Jobs disclosed last week that
he gave up more than 4.5 million Apple shares - less than 1% of Apple's
outstanding common stock - valued at $296 million, leaving him with 5.4 million
shares valued at about $333 million.
The transaction was part of a restricted stock grant of 10 million shares,
on a split-adjusted basis, Apple awarded to Jobs in 2003 for his services
helming the company. Those restricted shares vested this month. Jobs is
surrendering about half the award; in exchange, Apple is paying the taxes due
on the shares. Jobs avoids dealing with the tax hit and Apple gets to slightly
reduce its number of shares outstanding. (Jobs also holds options for 120,000
shares granted to him for serving as an Apple director).
Moreland says this type of arrangement is common for corporate executives.
While some insiders sell the shares left over after surrendering a portion of
their stock to cover tax obligations, the fact that Jobs, for now, isn't
selling his remaining share holdings on the open market suggests confidence in
the company's prospects, Moreland says. "This would be a pretty bone-headed
move if he thought the stock was going down," he says.
Jobs clearly is more confident about Apple than he has been in the past.
After being forced out of the company he co-founded in 1985, Jobs famously
whittled his stake in Apple down to a solitary share. After selling his second
company, NeXT Software, to Apple in 1997, Jobs worried about Apple's future and
again repeated the gesture, holding on to a symbolic single share after selling
1.5 million Apple shares for more than $22 million, he told Time magazine that
year.
Shares of the stock rose 6.2% today to $62.33, bouncing from a sell-off that
has taken the stock down from heights of more than $86 in early January.
(END) Dow Jones Newswires
03-29-06 1749ET
Copyright (c) 2006 Dow Jones & Company, Inc.
17:49 032906 |
