Bareley Managing - Martha Stewart's Recipe for Disaster

by Markus Nolte

Martha's stock-trading scandal shows what can go wrong when a company's intellectual assets get too concentrated.

Martha Stewart's investing acumen makes me look like George Soros. As the entire world now knows, the chief, cook, and bottle collector of Martha Stewart Living Omnimedia (MSO) sold 3,928 shares of ImClone (IMCL) stock on Dec. 27, pocketing $227,824, a day before the company announced that the government had denied approval for its drug Erbitux. ImClone stock promptly dropped about $12 a share. It has since fallen much lower, but on Dec. 31, Stewart could have sold her stock and collected $180,000 without anyone batting a legal eyelash. That's just 48 grand less than she got.

As it is, the aroma from Stewart's fortuitously timed trade resembles something that comes from a room other than the kitchen. That's because she is a good friend of the then-CEO of ImClone, Sam Waksal, who has since been charged with insider trading. On July 1, MSO closed at $11.50, down from its high for the year, $20.01. According to the proxy statement, Stewart owns almost 31 million shares. If we can ascribe all of the stock's loss to her malodorous misadventures, Stewart's $48,000 gain has already cost her $261,371,672 (plus legal fees).

More >

Comments

Recent comments

Volker Weber on Marshall Monitor II A.N.C. :: Erste Eindrücke at 08:13
Maikel Maes on Marshall Monitor II A.N.C. :: Erste Eindrücke at 07:58
Jochen Kattoll on The Neighbor’s Window :: Oscar Winning Short Film at 22:21
Harald Gärttner on Microsoft Office app on Android and iOS at 15:09
Volker Weber on App-Store-Interna: Apple geht gegen Buchveröffentlichung vor at 14:55
Oliver Stör on App-Store-Interna: Apple geht gegen Buchveröffentlichung vor at 13:42
Volker Weber on Microsoft Office app on Android and iOS at 13:02
Harald Gärttner on Microsoft Office app on Android and iOS at 12:56
Volker Weber on Marshall Monitor II A.N.C. :: Erste Eindrücke at 08:07
Thomas Cloer on Marshall Monitor II A.N.C. :: Erste Eindrücke at 07:57
Matthias Lorz on The Neighbor’s Window :: Oscar Winning Short Film at 12:47
Volker Weber on The Neighbor’s Window :: Oscar Winning Short Film at 11:54
Fabio Peruzzi on The Neighbor’s Window :: Oscar Winning Short Film at 11:48
Fabio Peruzzi on The Neighbor’s Window :: Oscar Winning Short Film at 11:45
Horia Stanescu on The Neighbor’s Window :: Oscar Winning Short Film at 07:04
Martin Funk on The Neighbor’s Window :: Oscar Winning Short Film at 00:00
Sven Bühler on I am not ready for a foldable phone at 22:03
Andreas Imnitzer on The Neighbor’s Window :: Oscar Winning Short Film at 21:48
Roland Dressler on I am not ready for a foldable phone at 15:02
Daniel Seiler on I am not ready for a foldable phone at 13:51
Roland Dressler on I am not ready for a foldable phone at 12:55
Hubert Stettner on I am not ready for a foldable phone at 10:51
Matthias Welling on Tools and Weapons #nowreading at 09:05
Ingo Harpel on You may secretly be a Bing user at 20:01
Amy Blumenfield on Tools and Weapons #nowreading at 19:44

Ceci n'est pas un blog

I explain difficult concepts in simple ways. For free, and for money. Clue procurement and bullshit detection.

vowe

Contact
Publications
Stuff that works
Amazon Wish List
Frequently Asked Questions

rss feed  twitter  amazon

Local time is 05:43

visitors.gif

Paypal vowe