GameStop Director Sells 2.3 Million Shares of Stock
GameStop's busy holiday season is coming up, in addition to the mega-release of Modern Warfare 2, so why has its director sold 2.3 million shares of company stock?
In a move that confuses even well-known videogame industry financial analyst Michael Pachter, GameStop director Leonard Riggio has recently sold 2.3 million shares of his company's stock for an estimated $60.2 million. Riggio now owns 9.1 million shares, down from 11.4 million. Pachter's confusions stems from the fact that he believes GameStop will "benefit from several near-term catalysts, including hardware price cuts, a much improved software release slate, and much easier industry sales comparisons."
At least part of that release slate includes what could be the most gigantic of all humongous videogame releases in a while: Modern Warfare 2, predicted to sell a heck-load. Supposedly, the sale was made for the purpose of tax planning, but certain signs may indicate otherwise according to Alex Romayev, co-founder of insider trading data firm Form4Oracle. Romayev points out that Riggio also owns a much bigger stake in Barnes and Noble, and believes: "Unless [Riggio] desperately needs $60 million ... Clearly he thinks selling GameStop is better than selling Barnes & Noble."
The last time Riggio made a large sale of GameStop stock was in October 2007, helping him to avoid a 62% loss, but it's still possible that the more recent sale was been made just because Riggio needs some dough. Pachter makes a pretty nice jab at Riggio if that is the case, saying: "The only thing I can tell you is that he probably had something better to do with the money. I feel sorry for these guys who can't live on anything less than $20 million." Take that super-rich guy, someone feels sorry for you.
Even to a complete stock market novice like myself, this seems like an odd time to unload $60.2 million in shares of GameStop. Perhaps the holiday season is expected to be slow all around, and even the release of Modern Warfare 2 can't save one of the world's most prominent videogame retailers this year.
Source: Barron's via Gamasutra
"In a move that confuses even well-known videogame industry financial analyst Michael Pachter"
No, Michael Pachter is always confused.
That is quite interesting.....He might know something the general trading public doesn't know, or he might be selling stock to make the price drop to buy it up cheaper...which, both I believe are illegal.
Only time will tell.
that's strange, tho it's usually not a good sign, tho i wonder if he'll get nailed for insider trading for this
Clearly, his family has been captured by former KGB spies and Mr. Riggio needs the money in order to hire an elite team of mercenaries from different militaries in order to get them back.
Why can't you people see that this man has the purest of intentions?
What an odd move, I would have waiting until after Modern Warfare or late into the Christmas period personally.
It sounds like he needs the money fast either that or he has illegal intentions
I'd like to buy some shares of GS. Sit in on one of those stuffed shirts shareholders meetings. Tell em what they need to fix. Like hiring girls that know absolutely NOTHING about video games.
Hmm... Kinda suspicious... Not my business tho... *Leaves the room*
Doesn't seem like he has all that much faith in the company.