While you queued for an iPhone 6, Apple's Cook sold shares worth $35m Apple CEO Tim Cook and four fellow Cupertino execs flogged a load of company stock worth $143m last week. According to a report from Barron's, the five top execs at the iThing giant dumped shares in a scheduled selloff, in the days following the launch of new iPhone 6. Barron's estimates that Cook's sale of 348,425 shares in …
I hope you mean "bent" as in "inclined to dishonest financial dealings" and not in any other sense.
Now, don't get me wrong, I'm no conspiracy theorist...
The sale of shares was scheduled for a particular date but how can there not have been any conflict of interest, commonly known as INSIDER DEALING since the date of release of the next iThing was already known to the sellers of the shares?
Summat stinks.
Nobody is wondering why execs are dumping shares just before the release of a new product? I can imagine that the window for not being allowed to trade in your own company shares covers the period of fluctuation due to a big product release since the price usually goes up. What if you're expecting the share price to dip lower than your sale price before the launch whilst the embargo period is still in place?
Nobody is wondering why execs are dumping shares just before the release of a new product?
They didn't. They registered intent to sell before the launch, but the registered sale date was after launch which meant they were riding the post event surge. In a way that is showing trust in their own products (or own hype).
To be honest, I don't think that really counts as insider trading. First of all, there cannot be that many people who did not know the exact launch date, secondly it's also no real secret it would present new products. Even outsiders could have ridden that wave and I suspect many have.
In that context I'm very suspicious of the aggressive reporting of defects - statistically, they don't really register on the volume (AFAIK it's not even 1% of production) so it's almost like some people really wanted Apple stock but not pay full market price.
Selling the shares knowing there would be some serious issue would be iffy but that's not the case - they registered intent then sold the shares AFTER the launch so unless they then purposely knobbled the 8.0.1 update for some users and paid 9 people (out of 10m+) to bend their phones and paid the news outlets to paint it out of all proportion can't see an issue.
Reality is they get part of their renumeration in shares so it may be necessary to sell some shares to buy a new mansion or two. They still owe a LOT of Apple shares so still have much more riding on its SUCCESS.
"In that context I'm very suspicious of the aggressive reporting of defects - statistically, they don't really register on the volume (AFAIK it's not even 1% of production) so it's almost like some people really wanted Apple stock but not pay full market price."
The failures thus far may not be material, the failure rate could be. It's all very well saying for the first few that "a fat kid sat on it and ran away". That is probably true at this stage. But most of us put our phones in pockets sooner or later. And although I'm ideal height/weight, not being a robot there's still a good curve on my jeans front pockets that will put some repeated stress on a be-pocketed phone.
With the new shiney having a frame made of aluminium, the strain on the device is going to be cumulative if (like me) you usually put a phone in the pocket with a particular orientation, say back cover outwards. Every time the device goes in a pocket, it's creeping a little bit. If you use something inherently flexible (plastic, Samsung) or stronger (a much stronger aluminium alloy), or you beef up your design you don't have that accumulative risk. But potentially these first few bent ones will over time lead to a substantial proportion of those made to date needing replacement. I daresay some leech is already looking to file a class action against Apple, but replacing several million high end phones won't come cheap. At a replacement cost of only $200, and say that Apple amend the design immediately, you've got 10m sold and the same in the supply chain, 20% need replacing, and you're looking at around a billion dollars before any punitive court settlement.
And worst of all, this chips away at the reputation of Apple. FFS, they've launched a phone fit for 2012 two years late, and it's vulnerable to creasing?
FFS, they've launched a phone fit for 2012 two years late, and it's vulnerable to creasing?
Maybe they accidentally swapped specs, and the next iPhone is going to be a folding clamshell. There's no real other variation left.
Personally I'd love a clamshell - I run my second SIM in a last generation Motorola v3i (keyboard is matte, which was the biggest physical issue) and it's still the best physical form factor I've ever had in my hands (second was IMHO the banana Nokia, although the mike contacts in the slide were not terribly good). The v3i is so good as a straight forward phone (remember those?) that the crappy software inside it matters little. Good, quad band reception, battery lasts up to 3 days and is swappable, and small enough to live in a suit or trouser pocket without it being visible or awkward. Nothing has ever even approached that perfection since. If I had money I'd buy the design and started talking to Jolla.
Phablets? I accept they may work for some people, but I'm not one of them. I get too many flashbacks to the Big Phone Guy of Trigger TV :).
"The v3i is so good as a straight forward phone (remember those?) that the crappy software inside it matters little."
I follow the argument (still having a couple of fondly remembered V3s in a box somewhere, along with an assortment of Nokia candy bar sets) but the market has moved, and people expect a phone to do all the fancy mobile computer stuff now, and it's the use of that extra functionality that uses the battery. If you use the capabilities frugally, then a smartphone will give you two to three days.
And to be fair, the size difference between a folded V3 and a 4.7 inch touchscreen isn't umanageable. All of this "mine's big than yours" stuff is of course nonsense, but at least we've now reached a point where all major makers seem to offer a full range of sizes to suit most people. If makers would now stop wasting money on pointless legal squabbles, and start spending money on making the battery last several times as long as the current model, then they're assured that I'll upgrade at the end of my contract.
This 2012 line is a tired one. The iPhone 6/6+ are pretty much the best phones you can buy regardless of screen size - yes you may like Android over iOS but they have some fantastic tech in them and I'm fairly certain a lot of people will leave Android for iOS now they can get a larger screen.
The only question is what can Samsung do now - perhaps give up like they did with Chromebooks? The Android market is pretty much done - why would anyone buy an expensive Android with all the competition. At least with Apple you get better support etc. and a device you can used for 3-4+ years.
I'm not even really sure that executives should be allowed to hold so much stock in the companies they run. A high share price doesn't necessarily mean the company is in good shape - it could just mean it is ripe for a takeover. That means that a number of activities that are good for (those who hold a lot of) the stock (e.g. axe a huge number of staff and keep the order book --> short term share price rises) are not actually good for the company.
Maybe if some other body dictated the dates at which they could cash in the stocks, or it was planned very far ahead, or they had to hold them for a minimum of x years - I don't know, I just have an uncomfortable feeling that holding a large amount of stock in a company may not always encourage you to do the right thing for the company. Founders who hold a lot of stock at least seem to have some emotional investment in their erstwhile baby.
"I'm not even really sure that executives should be allowed to hold so much stock in the companies they run."
The alternative problem that not allowing stock ownership creates is the agent problem. Whilst directors can be (and usually are) paid cash, why will they do the right thing for shareholders (as opposed to themselves) if they've got dissimilar financial interests? Even with share options and grants, that doesn't stop useless, self interested management getting an entrenched position and destroying the company (HP, for example).
There is no easy answer, although a ban on companies soliciting and recommending proxy votes would be a good move. Too many inept boards are kept in place by passive investors who either don't vote on shareholder motions, or offer their proxy to the board.
I never really get why bosses are allowed to sell stock in their own company whilst there still employed with it. Actually I would also set a limit that you cant sell your shares until you've been away from the company for more then 5 years.
That would mean you cant pump and dump the shares, you cant co-incidentally schedule a selling of your shares to happen a week or so after a brand new product comes to market, or before you announce something causing the shares to dive. You are stuck with the shares for good or bad. And you have to leave the company in a good enough position, and with a good enough person at the helm that your shares will still be worth something in 5 years time.
That would certianly provide incentive to make good decisions for the company and for its long term future. Still cnsidering how greedy the twats at the top are, something like that will never happen...
Those who are designated as insiders, like CEOs and other higher ups, have restricted windows in which trading is permitted - well away from earnings announcements. The planned trades have to be registered with the SEC in advance (date(s) and quantity) and the sale or purchase of the stock is conducted at market price.
They would have had no idea about celebgate, bendgate, iOS 8.0.1 getting pulled, the number of sales of iPhones sold, etc. If something had happened which severely dropped stock prices, like another 9/11 style attack on NYC, all stocks would have dropped like a rock including Apple and they would have wished they hadn't sold, etc.
If the Reg wrote articles about Google's insider stock trades, you'd find Larry Page sold nearly 100 million shares of Google worth over half a billion dollars between Sept 8 and Sept 12 (you can find this at Yahoo Finance or any other site that provides stock info) If the logic applied by some commenters was used there, they'd claim he was selling out because he was afraid iPhone 6 would cause Google's stock to tank - indeed it has dropped 20 bucks in the past week since iPhone 6 starting shipping. I'm sure that's just a coincidence, but if you have an agenda, a coincidence will become cause and effect in your comments!
Of course it was insider trading.
These execs knew exactly what products were in the pipeline & when these products will be released. So they can schedule the buying/selling to their advantage. They have the information necessary to make profits, these information aren't publicly available - thus insider trading.
Just because SEC colluded with the whole transaction doesn't mean it's not insider trading.
If you argue that, then no insider should ever be allowed to buy/sell a single share, because they always know what is in the pipeline, or when nothing is in the pipeline, when things are good or bad. The SEC watches these transactions pretty closely, if a CEO who never sells his shares suddenly unloaded half of them a couple months before an expected product turned out to be delayed due to manufacturing difficulties, or he mortgaged everything he owns to buy a bunch of shares a shortly before releasing a flying car, they'd pounce on him.
Cook is selling shares because Apple granted him 1 million shares vesting in pieces over 10 years, which is now 7 million shares after the split. Plus he already had quite a few shares prior to that from the years he worked for Apple. I haven't looked it up, but like many large holders he probably has regular planned sales to diversify his wealth as well as have some cash for doing stuff like buying houses, giving to charity, blowing it on a long drunken weekend in Vegas, or whatever.
The media missed out several generations of Bendgates, but the 'biggy' phone gave the cowards a get out clause to report it without repercussions.
One wonders if they have to act en-mass so as not to suffer the wrath of Apple withdrawing advertising.
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