Amazon Insider Sales: Does Jeff Bezos Know Something?

Just as the markets are seeming to be on the way to new highs and Amazon.com (AMZN) announces a new Kindle device, founder and CEO Jeff Bezos is thinning out his holdings. Perhaps it is a planned sale or the desire to diversify (a common rebuttal when critics ask about large insider selling).

No matter, it is a big chunk that is being sold into what appears to be the launching pad for Amazon shares.

Total $382,882,650

Of course insider sales are often said to be less than accurate at predicting the direction of a stock, but selling is often a better indicator of future moves than buys. CEOs and management will usually have an uncommon optimism about their company’s prospects into the future as they are saturated with the company story, day in and day out. Yet sales of this magnitude need to be looked at carefully, especially given the current state of these fragile markets.

(Click chart for Amazon insider transactions)

Retail stocks have been on fire over the past few months as they have seemed to defy gravity in this uncommon recession. Amazon has emerged as the clear winner as they have executed flawlessly and provided a constant and reliable string of earnings year in and year out. Remember, it was only 10 years ago that most market experts has a forecast that this online-bookseller would be out of business by the end of 2002.

Perhaps now is a time to take some money off of the table, even if you have been a happy Amazon shareholder.

Comments

[mikebrah:]

I happen to be bear on AMZN, but this data is irrelevant when you consider he still has 97 MILLION SHARES LEFT.

Regardless of your thoughts on the stock, you can't blame a guy for taking 5% off the table.

Just my $.02

MM

May 06 10:21 AM

[joof:]

He has been there for years. Options expire , usually at 10 years from grant . He may have had to exercise to avoid losing the options .

What are the grant dates of the options he exercised? If you can answer that you may have a point.

May 06 08:32 PM

[seattleite:]

Oh Gosh, Jeff Bezos is selling. Everyone dump their shares quickly. So what if Jeff Bezos has been with Amazon for 14 years, so what if he has 100 million shares and is already around 45 years of age. He should not sell his shares. He should not sell 3% of his shares. He should not enjoy his life after all the hard work he has done. He should live like he does not have any money till he is 65 so that we can be sure that he is confident about the stock. Gimme a break dude.

I hate this. Any Tom, Dick and Harry comes and write any crap on seekingalpha. The site is becoming crap.

May 09 07:31 AM