Report Card Time

Gabele reviews past columns to see how successful he was in forecasting specific stocks.
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With 10 weeks of columns under our belts, now's a good time to take a look at how we've fared thus far.

Of course, it's never too early to boast.

Cypress Semiconductor

(CY) - Get Report

, the subject of our

May 18 debut, looks to have been a no-brainer. As you may recall, insiders were quietly exercising nonqualified options and holding onto the shares. With the stock mired in the $11 range, there seemed to be suspiciously little to get excited about, but we said the insider action could possibly indicate a significant rise in the shares' price. Within a month, Cypress jumped more than 70% -- to an intraday high of just over 21 per share -- and the stock has since struck a 52-week high of 21 5/8. Is there more to come? Perhaps, but just now we are beginning to see indications that insiders are locking in their gains.

On June 22, we

highlighted an impressive round of insider buys at

Adept Technology

(ADTK)

. Remember, like Cypress, insiders at Adept exercised nonqualified options and held onto the shares. We thought it was a sign of something positive that was already under way. In the month or so since, the stock has gained more than 40%, peaking at more than 10 1/2 per share.

But it's not always that easy. Neither of the regional banks we

covered in early July --

Firstar

(FSR)

and

Old Kent Financial

(OK)

-- has lived up to our expectations. In a reversal of their previous behavior, Firstar insiders were busy accumulating shares. At Old Kent, insiders were grabbing shares during an acquisition of

CFSB Bancshares

; even CFSB insiders picked up shares before the deal. We thought that insider confidence was a sign of good things to come. But Firstar has actually retreated about 10%, while Old Kent Financial has about broken even. In their defense, it's been a tough couple of weeks for the financial stocks, and it's still early. So we'll be watching these two closely in the weeks to come.

Our stories about insider

selling

have elicited the most spirited reader response. At

Boston Scientific

(BSX) - Get Report

--

highlighted on May 25 -- major inside players were selling 1.5 million shares, and we wondered whether the stock was poised for a drop. But we must admit that Boston Scientific has held up rather well in a shaky market. Like most, the stock has been up and down, but it's currently up about 6%, hovering around 40. Ahead of the

S&P 500

, certainly, but perhaps not at the level of outperformance many analysts predicted.

To judge from the rather creative name-calling we endured, our June 15

report on insider selling at

Electronics for Imaging

(EFII) - Get Report

struck a nerve. In that column, we talked about the fact that six insiders had exercised options in April and May to acquire shares and then immediately sold them, suggesting that the stock's price could stumble. It's not over yet, but thus far the stock has shown few signs of slowing down: It's up more than 20% since we covered insider sales at the company in that column. Given the same circumstances, of course, we would draw the same conclusions again.

Supporters of

Pairgain Technologies

(PAIR)

and

Computer Network Technology

(CMNT)

have much less to celebrate. We were on the mark about those companies in our June 30

column. Few things are more discouraging -- or, for that matter, telling -- than finding insiders selling into share-price weakness. Throw in a healthy dose of controversy, and you've got yourself a recipe for heartache. Since that column ran, the bad news for Pairgain has kept on flowing, and the stock has kept on falling. The carnage is even worse for Computer Network Technology, which has lost more than 30% since our June 15 column. Ouch!

But don't forget, corporate executives are typically very early when they make buying and selling decisions, and many longtime insider-trading watchers consider six months a proper time frame to evaluate their moves. And academic studies of insider-buying situations have often found that the first insider-trading signal may take as long as six months to a year to be reflected in a company's share price. So it may be a little early to judge our performance.

Well, that's it for now. We'll give you an update on these and other stocks we've covered every few weeks or so. Until then, keep the feedback coming; even the rough stuff is welcome.

Mail Bag

On the subject of reader feedback, we were surprised by the number of comments submitted in response to last week's column on increased insider selling in the retail sector. For the most part, readers appeared to share the sentiment of

Bruce

, who wrote, "Most of the businesses you mentioned are at risk from the Net, and are generally late to that game themselves. No wonder they're jumping ship." A bit strongly worded, but a very good point.

And that's why we welcome readers' responses.

Bob Gabele has been tracking and analyzing insider trading since 1978, most recently for First Call/Thomson Financial. This column is not meant as investment advice; it is instead meant to provide insight into the methods of insider trading. At time of publication, Gabele held no position in any of the companies discussed in this column, although holdings can change at any time. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Gabele appreciates your feedback at

rgabele@thestreet.com.