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Sun Communities Inc. Message Board

  • dar200 dar200 Jun 26, 2013 4:44 PM Flag

    Another early exercise

    Naftaly exercised options on 6/24 way before their expiration.
    1,500 at 17.20 which did not expire until 7/18/18 (exercised all)
    1,000 at 14.95 which did not expire until 7/29/19 (still has 500 14.95 options)

    Likely a big income tax bill on the exercise but he starts the clock for holding period and starts collecting dividends, including this one.

    Lotsa reasons to do this, some very complicated. But generally, a very early exercise by an insider is a positive signal. Not as strong as an open market buy imo, but still positive.

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    • Naftaly strikes again with a way early exercise of options.

      Exercised all of 1,500 at 29.91 which did not expire until 5/23/17.
      Exercised his remaining 500 at 14.95 which did not expire until 7/29/19.....see above for first bite at this apple.

      Lotsa income tax to be paid to start the holding period and dividend stream. There is a reason(s) why he thinks he is better off exercising now risking his cash when he had years to wait with no risk and no tax cost.

      Perhaps he thinks the price is too low so he limits the tax liability by exercising now. Don't know why he pulled trigger so early. Of all the reasons I think one does a very early exercise, almost all are positive for the stock price outlook.

      • 1 Reply to dar200
      • Thanks for posting this.

        While it is certainly not negative, I am not sure there is anything to be drawn from it about SUI other than he does not see bad things ahead. Naftaly is a retired CPA (and one about whom good things are written - including the ability to spot problems ahead of time). Virtually every exercise he has done, even several years ago, has been way early. Has been a director since 06 or 07 and has had a number of exercises. His few open market purchases were good - 08 around $19 per, maybe some more later, and were done in tax deferred plans - IRA and Keough. His direct non retirement holding has climbed not just by option exercise but by the granting of restricted stock, which vests over time.

        If I had to guess, he is a smart CPA who manages his taxable income by spreading his exercises out, rather than waiting for them at once. Given his age (75), there is also an estate angle as well. He owns SUI in multiple pockets (IRA, Keough, direct, wife's IRA), so he has lots of tax management options down the road as well.

67.43+0.58(+0.87%)Nov 27 1:02 PMEST