By Grace L. Williams
(Editor's note: An earlier version of this story incorrectly
stated the number of Microsoft shares held by Fort Pitt Capital
Total Return fund.)
Microsoft shares went flying out the windows last week.
From Oct. 27 to 29, three Microsoft (ticker: MSFT) insiders
including iconic co-founder Bill Gates sold 12,525,000 shares for
$578,746,953, an average of $46.21 each.
Gates' transaction was the largest, a 10b5-1 planned sale of
12,500,000 shares for $577,601,150. Gates now directly holds
285,492,934 shares, a stake of 3.4% in Microsoft, down from 3.6%.
His most recent previous transaction was on July 30 when he sold
7,589,200 shares for $331,000,000, an average of $43.62 each, also
through a 10b5-1 planned sale.
Frank H. Brod, corporate vice president, finance and
administration, and chief accounting officer, sold 22,000 shares
for $1,007,980. Brod now directly holds 115,708 Microsoft shares.
His most recent previous transaction was on July 28 when he sold
1,500 shares for $66,100, an average of $44.04 each.
Maria M. Klawe, a director, sold 3,000 shares for $137,895 in
her first open-market transaction. Klawe now directly holds 23,105
Microsoft shares.
Director John W. Stanton, bucking the trend, bought 20,000
shares for $927,072, in his first open-market transaction. Stanton
now holds 20,188 shares.
Gates founded Microsoft in 1975 with Paul Allen. A previous
chief executive and chairman of the company, Gates now serves as a
technology advisor and on the company's board. Brod was named to
his post in 2006. Klawe is president of Harvey Mudd College.
Stanton is chairman of Trilogy Equity Partners, a private equity
fund, and Trilogy International Partners, a wireless operator in
Central and South America and New Zealand.
A spokeswoman for Microsoft was not immediately available to
comment on the transactions.
Jonathan Moreland, director of research for InsiderInsights.com,
sees the moves as insignificantly bearish overall. "Microsoft is a
textbook case of a founder with so much stock, and who now has very
little day-to-day insight," says Moreland in an interview with
Barrons.com. "I don't believe he's making any value calls and he
hasn't made one in over 20 years with his sales."
The tech stalwart's shares on Sept. 19 traded to a high of
$47.57, a record when adjusting for dividends and stock splits.
Microsoft closed at $47.44 on Monday.
"The enterprise business has only recently been recognized,"
says Jensen Investments analyst Kevin Walkush in an interview with
Barrons.com. "Consumer shift in demand to tablets from PCs caused
concern among the media and Wall Street that the PC may be
replaced, which hasn't been the case. It looks like the PC is still
a preferred way to do business."
Jensen Investments holds 6,368,501 Microsoft shares,
representing about 4.58% of his firm's portfolio.
Fort Pitt Capital Group senior equity analyst and vice president
Kim Caughey Forrest says in an interview with Barrons.com,
"Microsoft is more of a corporate play than a consumer play.
Instead of chasing after the elusive consumer going after something
cool, they made a product specifically for businesses."
Caughey Forrest adds, "The big question over Microsoft is about
cloud computing but it looks like the products are easy to
'cloudify,' and there was an easy transfer with Microsoft [cloud
platform] Azure."
Fort Pitt Capital holds 661,000 Microsoft shares, the
third-largest holding in the Fort Pitt Capital Total Return
fund.
Here's a rundown of insider trading activity reported on
November 3. An insider is any officer, director or owner of 10% or
more of a class of the company's securities. The table shows
purchases and sales which must be reported to the SEC and other
regulators by the 10th of the month following the month of the
trade, includes both open-market and private transactions involving
direct and indirect holdings. Excludes stock valued at less that $2
per share, acquisitions through options and companies being
acquired. Included are purchases, sales and stock registered for
sale for individual officers, companies, and sectors.
AC-member of the advisory committee. AF-affiliated person.
AI-affiliate of investment advisor. AV-assistant vice president.
B-beneficial owner of more than 10% of a security class.
BC-beneficial owner as custodian. BT-beneficial owner as trustee.
C-controller. CB-chairman. CC-member of the compensation committee.
CEO-chief executive officer. CFO-chief financial officer. CI-chief
investment officer. CO-chief operating officer. CP-controlling
person. CT-chief technology officer. D-director. DO-director and
beneficial owner. DS-indirect shareholder. EC-member of the
executive committee. EVP-executive vice president. F-founder.
FC-member of the finance committee. FO-former. GC-general counsel.
GM-general manager. GP-general partner. H-officer, director and
beneficial owner. I-indirect transaction filed through a trust,
insider spouse, minor child or other. IA-investment advisor.
LP-limited partner. M-managing partner. MC-member of committee or
advisory board. MD-managing director. O-officer. OB-officer and
beneficial owner. OD-officer and director. OE-other executive.
OP-officer of parent company. OS-officer of subsidiary company.
OT-officer and treasurer. OX-divisional officer. P-president.
R-retired. S-secretary. SC-member of the science/technology
committee. SH-shareholder. SVP-senior vice president. T-trustee.
TR-treasurer. UT-unknown. VC-vice chairman. VP-vice president.
VT-voting trustee. X-deceased.
*-Half of the transactions were indirect.
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