Massive Insider Selling as Market Hits Record Highs

Well, we knew it was coming, and after weeks of pretty tepid insider selling, the executives, directors and 10% institutional owners were selling stock this week in full force. It was anticipated that, as earnings blackout windows started to open up, insiders would start to take some money off the table. Who can really blame them, with the stock market’s major indexes all printing record highs?

We cover insider selling each week at 24/7 Wall St., and despite the big numbers and share counts that are starting to hit the tape, there is no immediate reason for alarm. We like to remind readers that many executives are compensated with stock and stock options, and they may be overweighted to their own companies’ shares. So, often sales are simply to diversify or for tax reasons.

Here are the companies that reported insider selling for this past week.

Graham Holdings Co. (NYSE: GHC) saw CEO Donald Graham sell 43,000 shares of the stock, at prices that fell between $985.50 and $994.41. The total sale came to a massive $42.58 million. The company is a diversified American conglomerate, best known for formerly owning the newspaper for which it was once named, the Washington Post, as well as Newsweek. The stock closed trading on Friday at $986.38.

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Honeywell International Inc. (NYSE: HON) also had the firm’s chief executive sell a large block of stock this past week. David Cote sold 303,798 shares of the blue-chip industrial stock at $104.30 apiece. The total of the sale came to $31.7 million. Honeywell shares were changing hands on Friday’s close at $102.78.

GoPro Inc. (NASDAQ: GPRO) had a 10% owner of the popular camera company sell stock this past week. RW Camera Holdings parted with 700,000 shares at prices that ranged from $45.18 to $45.87. The total of the sale came to $31.7 million. The stock has been cut in half since last fall, and this does not bode well for shareholders. Given the potential competition, current investors may want to weigh their thesis for owning the stock. Shares ended trading on Friday at $41.98.

PPG Industries Inc. (NYSE: PPG) had two top executives selling stock last week. The chief executive and a senior vice president at the company sold a total of 59,897 shares at prices that ranged from $233.890 and $236.20. That netted them $14.1 million. The company manufactures and distributes coatings, specialty materials and glass products. Its stock ended the week at $235.38, so some money was left on the table.

CAI International Inc. (NYSE: CAP) had a director of the firm sell a block of 500,000 shares at $23 apiece. The total for the sale came to $11.5 million. The company operates as an equipment leasing and management company in the United States and internationally. Shares closed trading on Friday at $24.28, so again, a fair amount remained on the table.

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These companies also reported insider selling last week: Analog Devices Inc. (NASDAQ: ADI), Flowserve Corp. (NYSE: FLS), Global Eagle Entertainment Inc. (NASDAQ: ENT), Kellogg Co. (NYSE: K) and Tessera Technologies Inc. (NASDAQ: TSRA).

In most of these sales, insiders were selling with the stocks near 52-week highs, which is not out of the ordinary. We will continue to monitor insider selling and advise readers if the sales suggest trouble could be brewing at the respective companies.

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