What the Insider Selling at these Companies Could Tell Investors About Their Future

General Communication Inc. (NASDAQ:GNCMA) has had several insiders sell shares so far this year, so this is the type of insider trading activity investors should watch out for. Executive Vice President and Chief Operating Officer Gregory F. Chapados sold 6,022 Class A shares on Tuesday and 8,978 shares on Wednesday, at prices ranging from $19.10 per share to $19.30 per share, trimming his stake to 513,290 shares. Moreover, Tina M. Pidgeon, General Counsel, Chief Compliance Officer, and Senior Vice President, unloaded 7,600 shares last Thursday at a weighted average price of $19.52 and currently owns 357,479 shares.

General Communication is a telecommunications corporation that operates in Alaska; as a result, its financial performance is highly dependent on the region’s economic conditions. By the same token, the economic conditions in Alaska are highly correlated with the state of the oil industry, which has worsened significantly in the past several months. It is highly likely that the depressed crude oil price environment, which is likely to stick around for several years, could negatively impact the demand for General Communication’s products and services. Might it be the case that the firm’s insiders are cashing out in anticipation of worsening economic conditions for the state and company? Only time will tell. In the meantime, the stock has gained 22% over the past year despite experiencing a significant pullback in December. A total of 13 hedge funds in our system had stakes in the company at the end of the September quarter, up from ten reported as of the end of the prior one. John C. Walker’s Stonerise Capital Management added a 500,000-share position in General Communication Inc. (NASDAQ:GNCMA) to its portfolio during the September quarter.

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