bzhayes (98.73)

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GIGM and insider trading?

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August 25, 2010 – Comments (5) | RELATED TICKERS: GIGM

Gigamedia (GIGM) suddenly jumped ~12% this morning (8-25-2010) and finished up 13.3% on the day. I knew they were reporting quarterly earnings soon, so I figured they announced them and this was market reaction. I did a little digging and came to find out the earnings report is coming out tomorrow before the market opens. Come to find out options traders are buying like crazy.

Purely speculation on my part but this sure does look fishy to me. It looks like someone got wind that tomorrow’s earnings will be good and is trying to get every penny out of this that they can. What do you fools think? Is this insider trading? I guess this kind of tom-foolery is what I should expect when investing in Asia.

Disclosure: I have a long position (with real money and CAPS) on GIGM

5 Comments – Post Your Own

#1) On August 26, 2010 at 2:43 AM, throwerw (30.74) wrote:

there is a lot of insider trading in chinese stocks, because nobody is paying attention.

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#2) On August 26, 2010 at 6:27 AM, fmahnke (97.41) wrote:

I think it may have been short covering heading into earning.

Why GIGM has a large short interest is a bit beyond me, (although will admit that mgt does not exactly inspire confidence)

I think I'm just mad because I sold my real life GIGM at 2.06 a few days ago,

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#3) On August 26, 2010 at 9:47 AM, naughtyguy (80.03) wrote:

Gigm should be investigated in my opinion. What did they do with the $100 million they got for the majority of their poker business?

Don't be mad selling for $2.06. Buy back in at $1.50!

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#4) On August 26, 2010 at 11:33 AM, bzhayes (98.73) wrote:

Yesterdays gains all but disappeared this morning

I agree naughty, I haven't seen any mention in the news releases about the infusion of $100 Mil.. It appears the $100 Mil has turned into $59 Mil. and GIGM is still bleeding money like a sieve.

I seem to recall the last proxy ballot had a bunch of stuff on it allowing management to pay out bonuses... I should have run away while I had the chance :(

I have a small position in GIGM so I am going to stick it out and hope they get their act together.

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#5) On August 26, 2010 at 5:13 PM, walt373 (99.87) wrote:

From the earnings release:

An initial cash payment of approximately US$100 million was received; however, the purchase price is subject to certain post-closing adjustments, which have not yet been finalized as of June 30, 2010.

I think the $59 million gain is only the difference between the selling price and how much it was being carried on the books at before the sale.

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