Jun 15, 2016

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Insiders Sell Significant Shares: Monster Beverage Corporation (NASDAQ:MNST), NVIDIA Corporation (NASDAQ:NVDA), Thermo Fisher Scientific Inc. (NYSE:TMO)

Insiders Sell Significant Shares: Monster Beverage Corporation (NASDAQ:MNST), NVIDIA Corporation (NASDAQ:NVDA), Thermo Fisher Scientific Inc. (NYSE:TMO)

“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.

Monster Beverage Corporation (NASDAQ:MNST) saw an insider sell on June 10, 2016 that may make shareholders worried. TABER HAROLD C JR, director, sold 5,000 shares at $154.14 a piece. The total sale came to $770,690, leaving the total count to 28,684 shares. Its shares currently owned by company management are 1.90% while institutional investors own about 67.90%. The 6-month change recorded in total insider ownership was -0.13%. On the other side, -2.75% change in total institutional ownership has been reported for the 3-month period.

Moving on to the second insider trade which involved HUANG JEN HSUN, a President and CEO at NVIDIA Corporation (NASDAQ:NVDA) sold 40,000 shares at $46.49 per share to trim the total holding at 1,777,279 shares. Its shares currently owned by company management are 0.80% while institutional investors own about 92.60%. The 6-month change recorded in total insider ownership was -16.86%. On the other side, 4.22% change in total institutional ownership has been reported for the 3-month period.

Thermo Fisher Scientific Inc. (NYSE:TMO) also received some insider trading action as WILVER PETER M, who the company’s Exec. VP & Chief Admin Officer is sold some 68,200 shares at a price of $152.38 per share to the holding that now comprises of 70,577 shares. Its shares currently owned by company management are 0.20% while institutional investors own about 89.80%. The 6-month change recorded in total insider ownership was -30.41%. On the other side, -1.94% change in total institutional ownership has been reported for the 3-month period.

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