<the writing was on the wall about INTC..>
This insider sale article is from last night, and I posted one similar one two weeks ago on the similar theme :
"Intel execs cashing out in a big way"
By Larry Barrett, ZD Inter@ctive Investor
March 3, 1998 1:16pm
Inter@ctive Week Online
Looking for a clue as to how Intel Corp.'s (INTC) stock will perform in
the next quarter or two? Well, often the average investor can glean
considerable insight by monitoring the trading activities, or lack
thereof, of leading executives.
Intel is a perfect candidate for the amateur sleuth because it's
tentacles spread so wide and into so many key markets. It wouldn't be an overstatement to say, for example, the opinions of Intel executives not only predicts the chipmaker's performance but also that of the entire technology sector in Asia.
Many Intel insiders have shunned numerous opportunities to sell shares
for incredible profits in favor of holding them and exercising options
for even more shares. But in recent months, some of the most bullish
Intel honchos have been selling in, in successively bigger numbers, at
progressively lower prices.
It's important to note, however, that this activity doesn't guarantee
anything. Executives buy and sell shares in their companies' stock at
various times for a million different reasons. Plus, there are
designated blackout periods several weeks before and after a company
announces its quarterly earnings in which executives cannot buy or sell stock.
"I don't make a whole lot out of inside trading," said Andy Neff, an
analyst at Bear, Stearns. "About 30 percent of the time, it's a good
indicator. But, you usually don't make that correlation until after the fact."
Now that you've been warned, here's a tidbit or two to ponder the next
time you call your broker:
From July through early October, Intel insiders were relatively quiet, selling under 150,000 shares while the stock traded between $89 per
share and $100 per share. Then, as the stock began to fall to $84 per
share in November to $69 per share in December, Intel employees began
selling more shares at lower prices., most recently with their
Now, insiders are taking profits from the recent rally to as much as $94 per share last week. From January 16 to January 30, eight employees filed their intention to sell 947,164 option-related shares at prices ranging from $75 per share to $82.50 per share, according to
CDA/Investnet Inc., a Fort Lauderdale, Fla.-based inside stock tracker.
Frank Gill, Intel's executive vice president and general manager of the Internet and communications group, stands to make the most cash in this latest crop. He plans to sell more than 390,000. Though Gill has been a frequent seller in the past, this disposition is his largest open-market sale since initially filing in 1985.
President and chief operations officer Craig Barrett, who hasn't sold a share since 1993, filed to sell 100,000 shares while treasurer Arvind Sodhani revealed plans to sell 45,500 shares-his first potential sale since 1991 and largest possible sale since becoming a filer in 1988. In fact, Mr. Sodhani exercised options and held onto the underlying shares on three separate occasions last year.
And finally, there's the example of Gerhard Parker, Intel's general
manager of the technical and manufacturing group. Parker had extremely
good timing in July 1997 when he sold 50,000 shares at $89 per share
before the stock went down the tubes. In late January, he announced his intention to sell another 50,000 shares at about $80 per share.
An Intel spokesman said the executives have no comment regarding their
individual stock sales.
Whether this unusually large sell-off is a harbinger of problems ahead
or simply lifelong employees cashing in their bounty for BMWs or new
homes in posh Silicon Valley suburbs remains to be seen.
"I can't speak to the specifics of Intel, but inside trading usually
isn't that big of an indicator," said Bill Gorman, an analyst at PNC
Institutional Investment Services. "There are other factors more
significant than executives cashing out, but it is something to keep an eye on."
Mang |
