Roth Bought Nortel Shares
In the analyst conference held by Nortel Networks Corp. (NYSE/Toronto: NT) yesterday (see Nortel Soothes Analyst Worries), CEO John Roth failed to mention something that might have carried a lot more weight than his other reassuring words. Roth himself has been buying Nortel shares.
In fact, Roth bought quite a lot on October 30 -- a total of 33,000 priced at $40 for $1.32 million, according to www.insiderscores.com, a web site tracking such activity. This was at a time when Nortel’s stock was being battered after it announced surprising numbers for its third quarter (see Nortel's Fright Night). Several other Nortel directors did the same thing.
“There might be several reasons a CEO would sell off some of his shares,” says Paul Silverstein, an analyst with Robertson Stephens. “But there’s only one reason he buys it. It’s a positive sign that reflects confidence in the company.”
Even though the stock has been falling since October 24, yesterday it gained three points and is sitting at $38 today.
-- Marguerite Reardon, senior editor, Light Reading, http://www.lightreading.com