To: Chris Steele who wrote (22600 ) 11/11/1997 2:54:00 PM From: Thomas M. Read Replies (1) | Respond to
Insider selling is an extremely subjective indicator, and Bob Gabele is one of the best at interpreting it. Gabele is quoted in this October 31 article: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).
