A top executive at
raked in more than $1 million from stock sales earlier this week after reports of a potential buyout propelled shares above $50.
Computer Sciences President and COO Michael Laphen netted more than $1 million Monday by selling 49,009 shares acquired through stock options. He sold the shares at $50.25 after exercising options with strike prices ranging from $11.40 to $34.90. The sale was the first one by Laphen since February 2004.
Laphen sold his shares under a so-called 10b5-1 plan, a pre-arranged plan created to prevent executives from selling shares based on insider information. The plans trigger sales when certain pre-arranged criteria are met.
In Laphen's case, the sales were triggered by the stock hitting a certain price, according to Bill Lackey, director of investor relations for Computer Sciences.
Such insider selling could suggest an executive believes the stock has reached a high point. But Lackey pointed out that other considerations also can come into play, such as the strike price on options and how much profit an executive wants to net from them.
On the day Laphen sold his shares, Computer Sciences stock shot up as high as $53.56 after
The Wall Street Journal
reported three buyout firms are in talks with CSC about a
takeover. The El Segundo, Calif.-based IT services firm's shares have since retreated slightly, closing up Wednesday $1.29, or 2.7%, at $50.
Citing unnamed sources, the
reported Wednesday that defense company
is also part of a consortium angling to buy Computer Sciences. Computer Sciences has declined to comment on the buyout talks.