So, what do they know that we don't?With Digital President Jack Williams' 24,000 options exercised yesterday, top executives have now sold 67,875 Gannett shares over the past month, public documents show. The five sold at prices ranging from $15.34 and $16.81, the documents show, as they unloaded options awarded a year ago as part of their 2008 pay.
What's more, for the second consecutive year, management persuaded the board of directors' compensation committee not to require that any of their 2009 bonuses be paid in company stock.
Insider sales are watched closely for signs that management thinks share prices have peaked. Executives may also be selling to raise cash ahead of the April 15 income tax deadline.
GCI closed yesterday at $16.72, up 1% -- far, far above its 52-week low of $2.10.
Four of the company's most senior executives have not sold yet, however: CEO Craig Dubow (left), President Gracia Martore, U.S. newspaper division President Bob Dickey, and Chief Digital Officer Chris Saridakis.Where do you think shares are headed as we near the release of first-quarter earnings? Please post your replies in the comments section, below. To e-mail confidentially, write jimhopkins[at]gmail[dot-com]; see Tipsters Anonymous Policy in the rail, upper right.
Am I right that these options were awarded at a strike price of about $2. If so, one thing they know is that their options are now worth eight times what they were a year ago and GCI stock prices have been hovering around $15/$16 for some time. Even if the price does go a little higher, that's a pretty good profit to sell on.
ReplyDeleteIf the overall market doesn't tank, then GCI will rise from here to the earnings release, and then probably give some of it back when the earnings are good but not great ("good" = beat street expectations).
ReplyDeleteIf you look at 4Q, the high estimates were $.60/share (non-gaap, ex-one time items) when Gracia said at a conference she was comfortable with the high estimates. This was what fueled the December/January rally in GCI. They actually came in at $.72/share, which was not enough to move the stock higher --it was already priced in by the optimists.
This time Gracia only signed up for the consensus estimates at a conference, of $.40/share. I expect the actual to be somewhere in the $.45-.50 range. If they are, then GCI likely holds on to most of the gains in makes in the next couple weeks. If it is less than $.45 then probably a significant sell off. If it is much higher than $.50 then likely it continues higher.
11:11 am: The strike price is higher, $3.75. But your point is still on the money.
ReplyDeleteI thought I read where they have ownership requirements. If so, how can they be selling?
ReplyDeleteJim,
ReplyDeleteyou need to check the SEC filings via the Gannett website. Sardarkis sold 5693 shares at $16.55 on 3/24/10.
I wrote about those Saridakis sales when they happened. But they weren't options, as I recall; they were shares in his 401(k). Still interesting, though.
ReplyDeleteCraig looks like a man going through a serious mid-life crisis! God help us all!
ReplyDeleteShame on them all. Where else would the people who created the company's debt crisis (borrowing as the industry was in decline with a short pay back period, based on future growth) be so handsomely rewarded? Corporate America, where executive can do anything except set the building on fire and still be given a fat bonus. A regular worker would be put on double secret probation told to clean up the mess and be given no increase at all. Hope your back starts acting up Craig!
ReplyDeleteThe problem isn't that they are cashing in stock options or the timijng - its that they're being awarded at all. For that, you have to blame the board of directors. They've handed out scores of options to managers lower on the food chain.
ReplyDeletePersonally, I have more of a problem with the cash bonuses being paid out in the past two years than options. Rewarding execs with cash while the rest of us take substantial pay cuts and go without raises is far worse.
Speaking of raises and bonuses.... Here in Phoenix, the Arizona Republic has been running stories this past week about how Maricopa County government has been doling out raises in the midst of record cuts. The Republic reports one county special council as saying, "I've more than saved what I get in a raise."
ReplyDeleteDoes this reasoning sound familiar? Is it me, or does the business world seem to have no regard for ethics any more. So too, you look at the Arizona Republic shamelessly reporting about the very thing their parent corporation is guilty of.
Scotty, beam me up!
http://www.azcentral.com/community/glendale/articles/2010/03/31/20100331maricopa-county-employees-raises.html