Even though the market took a significant breather on Friday, money has continued to pour in this year, and insiders who have waited patiently during the fourth-quarter earnings reporting period are stepping up selling, and stepping it up in a big way. While not the least bit surprising, given the big advance over the past year, some of the sales last week were pretty staggering in size.
We cover insider selling each week at 24/7 Wall St., and it is important for readers to remember that insider selling in and of itself is not necessarily a bad sign. Compensation packages for executives are often laden with stock and stock options, so many top executives may have much more of their own company’s stock than is prudent. Selling is often a diversification move.
Here are the companies that hit our screen with insider selling this past week.
Family Dollar Stores Inc. (NYSE: FDO) is being bought by Dollar Tree, and the chief executive of the former saw it was time to sell a huge amount of stock. Howard Levine sold a block of 1.8 million shares of the discount retailer at $78.51 apiece. The total for the sale came to a mind-numbing $144.1 million. The shares were trading at $78.80 on Friday’s close.
Diamondback Energy Inc. (NASDAQ: FANG) had a 10% owner sell stock, and it is not the first time. Wexford Capital sold 1.1 million shares of the company at prices that ranged from $71.28 to $71.79. The total for the sale came to a hefty $78.9 million. While the company still owns 1.65 million shares of the stock, it is somewhat disconcerting for shareholders to see a major holder sell stock that is was down from the highs last summer. With that in mind, the stock has rallied dramatically off the lows printed in December by 50%, and the firm still holds a significant position. The stock ended the week at $69.86, so a well-timed sale.
Blackstone Group L.P. (NYSE: BX) had a c-suite executive part with a big chunk of stock. The chief operating officer at the money management giant parted with 2 million shares at prices that ranged from $37.93 to $38.27. The total sale came to a very tidy $76.2 million. Shares closed trading on Friday at $38.75, so some cash was left on the table.
Cheniere Energy Inc. (NYSE: LNG) had two high-ranking executives at the company sell stock this past week. The chief operating officer and a senior vice president at the energy company sold a combined 230,000 shares of the stock at prices that ranged from $77.31 to $79.79. The pair came away with a total of $18.2 million as proceeds from the sale. The stock ended trading on Friday at $76.91.
Tessera Technologies Inc. (NASDAQ: TSRA) makes another appearance as insiders at the company continue to sell shares. A director sold a large block of 375,000 shares of the stock at prices that stretched from $40.39 to $41.46. The total came to $15.4 million. The stock has been on a roll, almost doubling since last summer, so shareholders should not be overly concerned. The stock was trading at $39.92 on Friday’s close.
These companies also saw insider selling this past week: Boston Beer Co. Inc. (NYSE: SAM), Dollar Tree Inc. (NASDAQ: DLTR), Goldman Sachs Group Inc. (NYSE: GS), Under Armour Inc. (NYSE: UA) and Wisdom Tree Investments Inc. (NASDAQ: WETF).
Investors should not be surprised to see large amounts of stock being sold. We carefully watch all insider sales for trades that look like a bailout rather than normal selling. This week’s reports look to be just normal selling.