Bad Market Cuts Insider Stock Trades
By RAJIV VYAS
Insider trades at Orange County companies fell this year as directors and officers curtailed selling stocks in the down market.
Through September, insider trades at OC companies was down by about half to $770 million from the same period a year earlier, according to Lancer Analytics Group, a Scottsdale, Ariz.-based firm that tracks insider trades.
Last year, OC insiders bought, sold and exercised stock options worth $1.4 billion. In 2000, their trading touched a high of $2.1 billion.
Thirty-nine OC companies saw insider trades this year vs. 42 last year.
Intersil Corp., which switched its headquarters from Irvine to Milpitas on Dec. 1, stood out. Insider trades at the maker of wireless networking and other chips was the highest among OC companies at $271 million, or more than 35% of the total.
Institutional investor Citigroup Inc., who’s James Urry sits on Intersil’s board, sold shares worth $130 million in March. Sterling Holdings Co., a Citigroup company also considered an Intersil insider, sold $130 million in shares.
Sterling led the $700 million buyout of Harris Corp.’s semiconductor arm, Intersil’s precursor, in 1999.
Gregory Williams, Intersil’s executive chairman who moved the company from Florida to Irvine in 2000, sold more than $11 million worth of stock in August. Richard Beyer, Intersil’s chief executive, sold 10,000 shares worth $190,000 in September.
Fifteen insider sales took place at Intersil through September vs. 16 transactions last year valued at $7 million. Only one insider buy was reported at Intersil so far this year.
Santa Ana-based Corinthian Colleges Inc. had the highest number of trades by insiders with 70 buys and exercised options.
David Moore, Corinthian’s chief executive, sold 429,000 shares worth $11.6 million through September. (He sold nearly $3 million more in November.)
Paul St. Pierre, vice president of marketing and admissions and a Corinthian director, sold 905,000 shares valued at $24 million. Chief Financial Officer Dennis Beal sold $2 million worth of shares.
Insider trading at Corinthian stems from the company’s solid showing on Wall Street, doubling from the start of the year to about 40 at recent check. Through September, insiders sold around 2 million shares at an average price of $26 for a total of $55 million. No insider buying was reported at the company.
As is the case with Corinthian, most directors and officers are more likely to sell their company’s shares than buy them in order to cash out and diversify their wealth.
Of the 538 insider transactions at OC companies this year, less than 50 were buys. Those purchases were valued at $19.6 million.
Around 250 sales worth $584 million took place through September. The remaining transactions were exercised options.
In 2001, when OC technology stocks were trading higher, 93 insider buys took place worth $18.6 million. Insiders sold $1.24 billion in 271 transactions.
In 2000, executives and directors bought $74 million worth of stock in 51 transactions. They sold shares worth $1.75 billion. Broadcom Corp.’s Henry Nicholas and Henry Samueli made up about $1 billion of 2000’s total.
After heavy selling again in 2001, insider trades at Broadcom slowed this year. In the first nine months, insiders at the chipmaker sold around $48 million worth of shares.
Cofounders Nicholas and Samueli again were the company’s biggest sellers. Nicholas and his foundation sold more than 800,000 shares valued at $29 million. Samueli sold around 425,000 shares worth $13.4 million.
More insider trading was seen at healthcare companies this year.
Lake Forest-based home healthcare company Apria Healthcare Group Inc. had 15 insider sales through September up from four a year ago. And sales in San Clemente-based medical device maker ICU Medical Inc. rose to $21 million from $9 million in the prior period. Trading at Costa Mesa drug maker ICN Pharmaceuticals Inc. rose to $10 million from $7 million in the year-ago period.
