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THE NEGATIVE TREND IN INSIDER SELLING WORSENS

15 September 2009 by Cullen Roche 7 Comments

For the latest two week period ending yesterday, insiders purchased just $4.6MM in stock while selling an astounding $471MM in stock.   That is a $217MM jump over last week’s reading of $254MM.  The trend in insider selling has been negative for quite some time, but even more alarming is the total lack of insider buying.  Insiders sell for a number of varying reasons, but it remains confounding that the equity markets can be so convinced of an economic rebound while insiders give a resounding vote of no confidence in their own companies via purchases of their own shares.   Perhaps the lack of organic growth via revenue growth has insiders less than convinced of the economic rebound.

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Cullen Roche

Cullen Roche

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Comments
  • TheDrugsDon'tWork

    May be managers are selling their shares in order to buy into the stock market and get diversity?

    09/15/2009 at 4:52 AM
  • Purple Teeth

    Yeah, If I were Robert Toll, I’d definitely want to diversify …

    09/15/2009 at 5:39 AM
  • BGray

    TPC,

    Have all other genuine recoveries been preceded/accompanied by large insider buying?

    09/15/2009 at 6:45 AM
  • Cullen Roche TPC

    Gray,

    I don’t have that data handy, but I can tell you that it is extremely odd to see this sort of low insider buying when a recovery seems to be so baked into the cake.

    09/15/2009 at 7:45 AM
  • jt26

    Maybe this is contrarian. Don Coxe says that in the mining sector, insider buying has always been a contrarian signal.

    09/15/2009 at 8:31 AM
  • systar

    This big ‘rally’ has the P/E zooming up.

    However, only the P (price) is increasing, NOT the Earnings…

    The guys that know why E is flat to down may see this ‘rally’ as pure speculation, or, at best, wishful thinking…?

    09/22/2009 at 8:47 AM
  • ooppsy

    oops i just pooped in my pants

    10/08/2009 at 2:24 PM