Ronny, this post of yours to Jimlur is misleading.
And, because you are among the most highly respected here, I need to respond.
You said: "The recent flood of discretionary insider selling activity at IDCC beginning in the middle of November is another of my concerns. The psychological impacts that all of these ongoing individual SEC form 4s are having upon the stockholders is unnerving to say the least. With almost every officer discretionally selling stock as the critical events rapidly approach, is definitely sending a bad signal to the investment community as to management's perceived ability to resolve these critical events in a favorable manner."
Generally, I agree that insider selling and insider buying are important signals. But, InterDigital is different. Because options are a big part of Interdigital's compensation package, all InterDigital insiders are awash in options - there will likely never be a need for an insider to actually go into the market and buy InterDigital stock. Conversely, we should fully expect options to be exercised and shares sold on a regular basis (as part of each insiders compensation).
But here's the part that is causes me concern. You provided a graph showing 10 recent insider sales and the percentage of shares sold (unfortunatly I cannot reproduce the chart here). The percentage of shares sold ranged from 13% to 77%.
We both know that sales of this magnitude can be very alarming.
We also both know that the sales were not of any such magnitude. The percentage of shares sold is highly misleading because of the requirements of the SEC Form 4.
Let's look at the big picture;
There are a total of 15 "insiders" (executive officers and directors) at InterDigital. (For reference, I am working from page 20 of the most recent Proxy Statement).
10 of these 15 insiders sold shares as noted in your chart.
The total number of shares sold by these 10 insiders since Novemeber (per your chart) is 147,000.
The total number of shares and exercisable options held by the 15 insiders is 3,471,000.
Therefore the recent insider sales equals 4.2% of insider holdings when you include exercisable options. This number is close to insignificant.
Further, each of these insiders receive additional options every year. For example, Goldberg sold 12,800 but he received 70,000 in 2001 and will probably receice a like number in 2002 and 2003. Lemmo sold 10,000 but received 50,000 in 2001. Merrit sold 8,091 but received 125,000 in 2001 (due to his promotion?).
My bottom line is that insider sales at InterDigital are to be expected and are not, in any way, a bearish indicator.
AI
