Disk drive round three: another insider reversal?

Article Abstract:

A trend has been noted among insiders in the disk drive market. Although stocks were accumulating in late 1995 and early 1996, mid-1996 is seeing insider selling of prominent stocks. Seagate Technology broke its non-activity in both buying and selling activities since Sep. 1995 when its insiders announced their plan to sell 376,856 shares in May 1996. The disk drive stocks have been exhibiting this trend that seems to keep in season with the European summer. Most analysts believe that it is the sector's good market timing that is most beneficial to its clients.

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Surprise!!!

Article Abstract:

The share prices of Cascade Communications Corp. have dropped unexpectedly and sharply, by as much as 36% in one day. This decline in the shares of Cascade may be related to the high levels of insider trading in prominent computer equipment firms such as Ascend Communications, 3Com and U.S. Robotics. While the computer equipment industry is considered viable, the incidence of high insider trading levels could be attributed to anticipated lower earnings despite favorable levels of current stock prices.

Cascade Communications Corp., CSCC

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Disk drive makers ... insiders may be signalling overvaluations

Article Abstract:

Strong insider selling activity among disk drive manufacturers could mean that insiders' expectations for stock price performance do not concur with that of Wall Street. Wall Street may have bid the shares up to a level where executives could sell considerable portions of their holdings with ease. This may result in negative earnings. Companies whose insider sales are being monitored include Seagate Technology, Storage Technology and Western Digital Corp.

Computer Storage Device Manufacturing, Computer storage devices, Rigid Disk Drives, Economic aspects, Hard disk drives

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