Insider Sales At Sirius XM
Recently, a reader requested that I communicate my opinion of insider sales, and how they may affect my sentiment of Sirius XM (SIRI) moving forward.
When you hear someone say "insider sale" what comes to your mind? I think it's safe to say that at very first mention, most people get a negative image. This is where it is important to take a step back and realize that there can be completely legitimate reasons for an insider to sell their stock, unrelated to potentially devastating news down the road.
The cheap vivier roger vast majority of insider sales are not done with some big plot and scheme plan to destroy the little guy. The vast majority are done for the insider to take some compensation they have earned, for tax reasons, or to diversify their investments. From Apple (AAPL) to Netflix (NFLX) to Research in Motion (RIMM), insider sales happen routinely and for different reasons.
Sirius XM (SIRI) insiders have issued quite a few indications to sell shares, or at this point have sold shares into the open market since the start of the new year. Here are the mbt shoes sales so far:In addition to these sales, Mel Karmazin has filed the option (note, option) to sell shares beginning in April of this year for which he has stated are tax reasons. Mel is not selling his entire stake, only a portion of his holdings, though it should be noted he holds a significant number of Sirius XM shares and this notice of intention of sale is a significant position. Mel may choose not to sell his shares if he has a change of heart.
As outsiders, we can merely guess as to why these individuals are selling. Could it be they know mbt scarpe something we do not and thus they are selling illegally? Perhaps, but I doubt it. Could it be they are selling because they "think" something bad is going to happen and are guessing, but have no real information? Again, perhaps.
The way I like to approach these guessing games is to simply put myself into the seller's shoes and attempt to see through their eyes. Try to get into their heads a bit.
So for now I'll slide into Mel Karmazin's skin and he can borrow mine. Meet the new Stephen Faulkner:
Now I have to think here about my situation mbt shoes usa as Mel Karmazin. I work for and have been working for Sirius XM as CEO for a considerable amount of time. In that time I have received as compensation a significant number of shares / options and have been stockpiling these and going about my day to day business with the company. Life is good, but a few things weigh on me at the moment.
First and foremost is that this year, while I am free and clear to sell my shares as I please, there was a looming problem for me on the horizon as of March 6th. After this date, Liberty (LMCA) may make any mbt online number of moves to acquire Sirius XM or increase their stake to controlling interest. While this should not be a problem for me and my shares, it could be. If Liberty makes a move, I'm locked down if I have not shown prior intent to sell, due to complications and insider information which will be flying around left and right surrounding these moves. For me to sell at that time would put me under a huge magnifying glass or might not even be possible at all. Right now I am a free man. Tomorrow I might not be. That is a huge liability. I'm going to be 69 this mbt footwear year. This is beyond retirement age for most and I'd rather not have such limitations placed on me at this point in my life. I have some goals and aspirations I wish to achieve with my charity work, and honestly, I'd like to see the effects of that before I pass on.
Third, 2012 is a favorable tax climate for me to do this in. 2013 might not offer this opportunity, and if my shares are locked up by a Liberty move, I might end up stuck making my transactions under those less than favorable conditions.
Ok Mel, you can have your skin back.
I mbt kisumu know, I know, Mel. It stings a little. It'll pass.
When we consider what an insider may or may not be thinking if they make a sale or indicate an intent to sell, it is always best to place ourselves in their shoes. In doing so, my opinion of these sales is that they are normal for the most part. Many of these individuals regularly sell, and Mel is getting older, plus with the favorable tax climate in 2012 a sale sooner rather than later is probably prudent.
When you consider the looming issue that Liberty might make a move and lock cheap timberland boots everyone down for awhile, it makes perfect sense that these insiders would want to make their moves now. With the moves all coming before the March 6th cutoff date, they ensured a bit of safety for themselves, and ducked the magnifying glass.
Do I think they are selling because of some unforeseen nightmare that some are trying to play this off as? No, absolutely not. As a long holder of Sirius XM, I am comfortable with these insider sales and indications to sell. They make sense to me. If I were in their shoes, I would do the very same thing.