Seeking Alpha

Arena chief's stock sale invites criticism

  • The legitimacy of any rosy pronouncements about Belviq's prospects by Arena Pharmaceuticals (ARNA -8.4%) CEO Jack Lief has been tarnished a bit with the disclosure of his disposal of a large portion of his holdings of ARNA stock. Mr. Lief felt compelled to unload almost 40% of his stake. Such a large transaction undermines the credibility of "asset diversification" and can only be construed as bearish behavior by the most significant company insider.
  • The ramp-up of Belviq sales has been underwhelming to most observers. Last quarter's sales were a modest $2.9M compared to Q2 2013's debut of $1.3M.
  • ARNA's stock is down 60% from its late June 2012 peak of $13.50. 208 mutual funds have positions, down from 210 a year earlier.
  • Consensus views remain bullish, however. Revenue estimates for Q2 and Q3 are $9.8M and $12.1M, respectively. Estimates for 2014 and 2015 are $43.8M and $85.7M, respectively.
  • The company should report Q2 results in mid-to-late August.
Comments (10)
  • SimonSaysShort
    , contributor
    Comments (112) | Send Message
     
    Nah, 40% is nothing. Nothing to see here, keep doing your thing Areniacs.
    7 Jul 2014, 12:28 PM Reply Like
  • Joseph Dedvukaj
    , contributor
    Comments (629) | Send Message
     
    I think it's safe to say that CEO Lief's stock sale was pre-planned and irrevocable since he had to comply with 10b5-1 SEC rules. I remain bullish with DTC advertising in high gear, combination Belviq-Phentermine studies ending this month (July, 2014) and smoking cessation studies concluding by November, 2014.
    7 Jul 2014, 12:31 PM Reply Like
  • Investor718
    , contributor
    Comments (81) | Send Message
     
    40% is a lot.
    7 Jul 2014, 01:01 PM Reply Like
  • The_Truth_in_NYC
    , contributor
    Comments (70) | Send Message
     
    i wonder why he stopped at 40?
    7 Jul 2014, 01:40 PM Reply Like
  • Mount Midoriyama
    , contributor
    Comments (4) | Send Message
     
    Artice linked to questionable Adam F hit piece as citation. Get out a calculator and figure for yourself. This transaction amounted to about 10% of Jack's vested holdings. Thanks to VikingBlazer on IV for sharing his effort on this.

     

    http://bit.ly/1j94xwI
    7 Jul 2014, 02:00 PM Reply Like
  • Flave
    , contributor
    Comments (35) | Send Message
     
    This sell off looks overdone to me. I just placed an order which was executed at 5.29. I'll see where it goes over the next few days.
    7 Jul 2014, 02:57 PM Reply Like
  • keahou
    , contributor
    Comments (37) | Send Message
     
    Who is the author of this article?
    7 Jul 2014, 04:58 PM Reply Like
  • amiram
    , contributor
    Comments (12) | Send Message
     
    dr. lief owes an explanation to his shareholders.
    7 Jul 2014, 05:19 PM Reply Like
  • User 16878372
    , contributor
    Comment (1) | Send Message
     
    This is to be expected from your hedge-friendly website. In fact it was pre-ordained that this kind of article would come from you'all. The market is down, the stock would be down today anyway. He sure didn't make boat loads of cash from this sale when he could have sold at $12 the way you are slanting your article.
    7 Jul 2014, 09:33 PM Reply Like
  • jakes101
    , contributor
    Comments (915) | Send Message
     
    looks like he made his own bed
    7 Jul 2014, 10:50 PM Reply Like
DJIA (DIA) S&P 500 (SPY)
ETF Hub
ETF Screener: Search and filter by asset class, strategy, theme, performance, yield, and much more
ETF Performance: View ETF performance across key asset classes and investing themes
ETF Investing Guide: Learn how to build and manage a well-diversified, low cost ETF portfolio
ETF Selector: An explanation of how to select and use ETFs