Insiders Sold $8.4B in Shares Last Month; Highest Sell-Buy Ratio Since 1987 - Bloomberg

Stock sales by America's corporate executives exceeded purchases last month by the widest margin since 1987, suggesting they don't share the confidence of investors who sent the Standard & Poor's 500 Index to a six-year high, writes Bloomberg.

Executives including Microsoft Corp.'s Bill Gates, Google Inc.'s Eric Schmidt and Kohl's Corp.'s William Kellogg in aggregate sold $63.18 of shares for every $1 they bought in November, an analysis by Bloomberg of data from the Washington Service showed. That's the highest since at least January 1987. Bill Gates sold 20 million shares for $581.1 million. 

  • Insiders sold $8.4 billion in shares last month, according to data compiled from SEC filings by the Washington Service, a research firm that tracks such transactions. Buying was almost $133 million, for a sell-buy ratio of 63.18.
  • That ratio surpassed a previous high of 62.76 reached in July 2005. The S&P 500 declined 2.2%t from August through October 2005.
  • The overall insider-selling figure last month was the fifth-highest since 1987. Selling peaked at $13.9 billion in March 2000, when the S&P 500 reached its all-time high. The index then fell 5.2% in the next two months.

Data from Thomson Financial also suggest that the outlook for profits is worsening. Analysts surveyed by Thomson forecast that earnings growth at S&P 500 companies will slow to 9.4 percent in the fourth quarter, ending a 13-quarter streak of expansion above 10 percent. The estimate is down from almost 13 percent at the beginning of October.

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