To All: I have some information on insider selling from the San Jose Mercury News. Each Monday, they publish a list of net gains for Si valley company insiders. The article states: "These Silicon Valley insiders had the largest net gains from stock trades during the time period reported below. In some cases, the number of shares acquired and sold are unequal during the reporting period. Therefore, the ''net gain'' reported in the period may not represent the true net gain on the shares sold." It's not too clear what they mean by reporting period.
I went back as far as 9-29-97. There were two insiders selling since that date.
10/1/97 Ralph B Godfrey, OX $2,581,640
10/6/97 Ross W. Manire, OX $9,880,298
There's nothing after that.
BTW, there was a lot of insider selling by Sun Microsystem during the last month. Also, Ascend may be in trouble. The following was published 10/31 in the SJ News:
Why Ascend's
descent just
doesn't end
ON ITS WAY up, Ascend Communications Inc. (Nasdaq, ASND) was a
darling of so-called momentum investors, stock pickers who like to buy whatever's
hot.
Now, as its stock has sunk steadily from nearly $80 per share in January to less than
$30, many of those same investors have been looking for excuses to pick up shares in
the Alameda-based maker of the hardware that makes the Internet click.
But two of the most popular reasons for believing that Ascend's stock will ascend --
that it has become so cheap and that it is acquisition bait -- turn out to be suspect.
Heavy sales in recent weeks by corporate insiders and frightening competition from
Cisco Systems Inc. (Nasdaq, CSCO) tell much of the story.
According to CDA Investnet in Fort Lauderdale, Fla., seven Ascend insiders have
indicated since mid-October that they'll sell a total of 439,924 shares. At roughly $30
per share, those shares are worth more than $13 million.
The sales can be interpreted in a variety of ways, but their existence makes one thing
clear: Ascend isn't being sold. At least not soon. That's because top executives
couldn't sell their stock while discussing a buyout, unless those merger talks are very
preliminary.
Insiders sell stock for all sorts of reasons, of course, but it's not comforting for
existing investors or those considering buying in to see executives, including CEO
Mory Ejabat and Chief Financial Officer Robert K. Dahl, cashing out.
Put differently, if you're hunting for value in Ascend's share price, off 67 percent
from its high, consider that the insiders likely wouldn't be selling if they expected the
company's value to surge soon. Ascend closed Thursday at $26.38.
''The real story here is that they're letting stock go at such cheap prices,'' says Bob
Gabele of CDA Investnet, which researches insider transaction data.
It's the first time top-level insiders have been allowed to sell stock since February as
the company has digested buyouts of Whitetree Inc. and Cascade Communications
Corp.
CFO Dahl, the journeyman finance executive who signed on with Ascend to help
shepherd it through its 1994 initial public offering, is ''contemplating'' retirement and
says his sales in part are for estate planning purposes.
What's more, the entire stock market's makeup has changed since Dahl filed his
sales, which account for about a fourth of the recent activity.
''I certainly didn't sell thinking Hong Kong was going to hell in a handbasket,'' says
Dahl, whose successor as CFO will be announced today (see next item).
Ascend's profits have been declining as it missed sales targets in the third quarter.
And in its key market, remote-access equipment that connects Internet service
providers to computer networks, competition from Cisco is looming.
''The remote-access business is becoming more competitive,'' says Nikos
Theodosopoulos , who follows data networking stocks for UBS Securities in New
York and rates Ascend a ''hold.''
Ascend's market share in remote-access products was 36.5 percent in the second
quarter, according to the Dell Oro Group, a Portola Valley research firm that
specializes in market intelligence on networking products. Cisco, the leading seller of
routers and other networking gear to large corporations, had 14.2 percent.
But as recently as the first quarter of last year, Cisco had zero market share.
Although its remote-access products aren't as advanced as Ascend's, it's coming on
strong. And it is, after all, Cisco.
THREE'S A TREND: Having made the case for Ascend not being buyout fodder,
here's one suggestion that it is. It's hired a CFO with a penchant for joining
companies that get purchased.
Ascend today is expected to tap Michael F. G. Ashby to replace Dahl, who will
remain with the company in a planning position.
A native of the United Kingdom, Ashby, 48, was CFO of Pacific Telesis Group's
unregulated business before the company was acquired by SBC Communications
Inc. He also headed Network Systems Corp. in Minneapolis before that company
was swallowed by Storage Technology Corp. and crunched numbers for El
Segundo-based Teradata Corp. before it was snapped up by AT&T Corp.
Does this mean Ascend's time is near?
''I'm not sure if that's a trend I want to see continue,'' says Ashby, who's says he's
joining the networking company with the expectation that it will remain independent.
|
