Heavy Insider Selling Activity Detected At These Two Blockbuster Companies

Most U.S equities surged yesterday, with the Standard and Poor’s 500 Index advancing by 1.83%. In fact, the benchmark has gained 5.59% since September 28, which marks the longest rally in 2015. At the same time, the Chicago Board Options Exchange Volatility Index, or the VIX, sank below the $20 level after staying above this level for 30 consecutive trading sessions. Indeed, this is all good news for most market participants, but we should not forget about the upcoming earnings season that is anticipated to largely disappoint the market. Analysts are expecting declines in both top- and bottom-lines for the S&P 500, which could eventually put an end to the ongoing rally. Meanwhile, some corporate insiders from giant companies have been reducing their holdings lately, which may theoretically suggest a gloomy outlook for these giants. The Insider Monkey team pinpointed two companies with heavy insider selling activity: Alphabet Inc. (NASDAQ:GOOGand Nike Inc. (NYSE:NKE). However, as theory should always be backed by evidence, we will attempt to identify potential reasons that may explain insiders’ decisions to sell stock.

 

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Let’s begin by checking out the insider selling activity at Alphabet Inc. (NASDAQ:GOOG). As of October 2, Google was turned into a subsidiary of Alphabet, the successor and parent holding company of the tech giant. Sergey Brin, Google’s co-founder and the president of Alphabet, reported selling 16,670 Class C shares on Friday at prices in the range of $603.43-to-$627.78, trimming his stake to 21.17 million shares. Apparently, this sale was not conducted under a trading plan, but the abundance of Form 4 filings submitted by Sergey Brin makes it hard to comprehend which sales are conducted via a trading plan and which are not. However, either through a trading plan or not, the president of Alphabet reported selling a sizable amount of both Class A and Class C common stock last week. Let us remind you that each share of the former Google is worth one share of the freshly-created Alphabet, which is still split into Class A voting shares and Class C non-voting shares. Andreas Halvorsen’s Viking Global reported owning 2.74 million Class A shares and 1.15 million Class C shares of Alphabet Inc. (NASDAQ:GOOG) as of June 30.

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