Insider selling/buying from NBR
-----------------------------------------------------------------------------------
08/15/03: "Market Monitor"- George Muzea, president of Muzea Insider Consulting Services
PAUL KANGAS: My guest "Market Monitor" this week is George Muzea, president of Muzea Insider Consulting Services. You know, George, it's been 11 years since you've been with us as a "Market Monitor." We just kind of lost track of you after you moved out West. But we caught up with you recently and I want to welcome you back.
GEORGE MUZEA, PRES., MUZEA INSIDER CONSULTING SERVICE: It's great to be back, Paul.
KANGAS: You know, your area of expertise has long been corporate insider trading activity and you just published a book entitled "The Vital Few Versus the Trivial Many." How does that relate to insider trading?
MUZEA: Well, the "vital few" are corporate insiders, and the "trivial many" is, unfortunately, the public…
KANGAS: You and I.
MUZEA: Unfortunately, especially those of us who are influenced by the market experts who are, as you know, wrong in extremes. So it's a contrarian approach to the market using both the people who are influenced at the wrong times to do the wrong thing, which are the 80 percent of the - which is the "trivia many," and then the 20 percent is the "vital few" or the corporate insiders. So when the extremes - when they are at opposite ends of spectrum, that's when you want to go with the insiders
KANGAS: Well, your latest research on the market shows you what regarding insider trading? Are there more people buying insider stock or selling? How does it work?
MUZEA: There's a little buying going on but not very much. We had a lot of insider buying at the bottom of the market on March 7 before it took off. And as you remember, the market was deeply oversold and the sentiment was very, very negative. The public wasn't in and insiders were buying. And that was a great time to get in. Now we have the opposite. The public is getting more interested in the market. The media and the so-called experts that exploited - on the media, basically, are very, very bullish...
KANGAS: Is it as extremely bullish now as it was bearish at the bottom of market?
MUZEA: Just about.
KANGAS: Really is?
MUZEA: Just about, just about. Just the opposite. For example, the American Association of Investors - Individual Investors, at the bottom of market in March, they were close to 60 percent bearish, now they are only 16 percent bearish. So they're very bullish. And insiders are selling quite heavily. So I think this is a good time to be watching the market very carefully, putting in some stops on stocks that you had, except for...
KANGAS: Sell stops.
MUZEA: Sell stops, except for core positions. And then look to be buying probably in the October-November time frame, which is always a good time to be getting into the market. And I think this year will be an excellent time
KANGAS: Well, OK, so that's the general overview.
MUZEA: That's the general overview.
KANGAS: It's bearish on the market, generally.
MUZEA: Yes, exactly
KANGAS: But there are some insider buying - there is some of this going on?
MUZEA: Yes
KANGAS: Can you give us some individual issues that you like where you see a lot of insider buying?
MUZEA: Yes. There are a couple of interesting stocks. The first one is WWCA (WWCA), which is Western Wireless. In this case we have four insiders…
KANGAS: Well, this has had a huge rise here, hasn't it?
MUZEA: Yes, yes. There are four insiders who originally bought, as you can see back last year, when the stock was under $ 5. And now these same insiders are buying up here at 14.
KANGAS: But you still like it because of that.
MUZEA: Oh yes, yes, because generally that's one of the better patterns you can have, where insiders, normally they buy into weakness and sell into strength. In this case they're buying more into price (ph)…
KANGAS: So that's an extra good sign.
MUZEA: That's an extra good sign, more…
KANGAS: All right. Do you have another suggestion?
MUZEA: Yes, I do.
KANGAS: On the buy side?
MUZEA: On the buy side. Baxter (BAX) labs.
KANGAS: OK. All right. There it is.
MUZEA: And Baxter labs, what we have here is we have a very important insider in this company who sold a couple years ago. You can't see it in your chart, but he sold when it was up at 49. And he is now buying right in here at 28. And so that reversal from where he sold at a higher price and now he is buying a couple of years later at a lower price, that's a good sign
KANGAS: We just have a minute left. First of all, let me ask you, do you personally own these stocks?
MUZEA: No, no, we don't, no we don't.
KANGAS: OK. On the sell side there must be some excessive insider selling.
MUZEA: Yes, yes, yes. On the sell side we have two stocks, NSIT (NSIT) which is Insight Enterprises, and this one we have a key officer selling up at these current levels. And he's not taking - and he could wait three more months for a long-term gain, but he's selling his stock at…
KANGAS: Oh, he's in a hurry to get out.
MUZEA: He's in a hurry to get out.
KANGAS: And the last one?
MUZEA: And the last one is HYDL (HYDL) where the CFO sold all of his holdings at current prices.
KANGAS: Wow, and the stock has had quite a downturn, too.
MUZEA: Exactly, we think there is probably a little bit more - maybe some bad news coming…
KANGAS: But you don't personally buy or sell short or sell these stocks?
MUZEA: No, exactly. We're a consultant. We advise institutions. I wrote the book for the public, "The Vital Few Versus the Trivial Many," but the institutions are my client base and we're a piece of information and they make their own decisions
KANGAS: Very good. George, it's great to have you with us again.
MUZEA: It's awfully nice to be here, Paul
KANGAS: Thanks for your insights. My guest "Market Monitor," George Muzea, president of Muzea Insider Consulting Services.
Nightly Business Report transcripts are available on-line post broadcast. The program is transcribed by eMediaMillWorks. Updates may be posted at a later date. The views of our guests and commentators are their own and do not necessarily represent the views of Community Television Foundation of South Florida, Inc. Nightly Business Report, or WPBT. Information presented on Nightly Business Report is not and should not be considered as investment advice. Copyright (c) 2003 Community Television Foundation of South Florida, Inc. ALL RIGHTS RESERVED.
-----------------------------------------------------------------------------------
lurqer |
