Jun 24, 2016

Posted by in Stock Reports | 0 Comments

Insiders Sell Significant Shares: Cisco Systems, Inc. (NASDAQ:CSCO), Facebook Inc(NASDAQ:FB), Applied Materials, Inc. (NASDAQ:AMAT)

Insiders Sell Significant Shares: Cisco Systems, Inc. (NASDAQ:CSCO), Facebook Inc(NASDAQ:FB), Applied Materials, Inc. (NASDAQ:AMAT)

“Insider trading” is a term that most investors have heard and usually associate with illegal conduct. But the term actually includes both legal and illegal conduct. The legal version is when corporate insiders—officers, directors, and employees—buy and sell stock in their own companies. When corporate insiders trade in their own securities, they must report their trades to the SEC.

“Insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise” (Peter Lynch, one of the greatest investors of all time).

Insiders know their industry, in particular the company they are managing.

Insider trading can be profitable only if securities prices move. Therefore, insiders hoping to trade on inside information may try to get the price to move by cutting the company’s costs, seeking new products, and so on. While such actions benefit the insider, they also benefit the firm’s security holders as a group.

No one invests to lose money, so do corporate insiders. They are prevented from buying and selling their company stock within a six-month period: therefore, insiders buy stock when they feel the company will perform well over the long-term.

Cisco Systems, Inc. (NASDAQ:CSCO) saw an insider sell on June 21, 2016 that may make shareholders worried. Patel Pankaj, EVP, Chief Development Officer, sold 12,404 shares at $28.86 a piece. The total sale came to $357,995, leaving the total count to 5,412 shares. Its shares currently owned by company management are 0.10% while institutional investors own about 77.20%. The 6-month change recorded in total insider ownership was -22.47%. On the other side, -0.90% change in total institutional ownership has been reported for the 3-month period.

Moving on to the second insider trade which involved Koum Jan, a Director at Facebook Inc(NASDAQ:FB) sold 7,834 shares at $115.00 per share to trim the total holding at 22,285,150 shares. Its shares currently owned by company management are 0.20% while institutional investors own about 0.30%. The 6-month change recorded in total insider ownership was -70.78%. On the other side, 2.25% change in total institutional ownership has been reported for the 3-month period.

Applied Materials, Inc. (NASDAQ:AMAT) also received some insider trading action as Salehpour Ali, who the company’s Sr. VP, GM New Mrkts & Service is sold some 17,752 shares at a price of $24.00 per share to the holding that now comprises of 513,443 shares. Its shares currently owned by company management are 0.50% while institutional investors own about 85.80%. The 6-month change recorded in total insider ownership was -1.25%. On the other side, -3.39% change in total institutional ownership has been reported for the 3-month period.

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