Mercadolibre (MELI) up 15% on Termination of CEO Stock Sale - www.fundmymutualfund.com , July 9, 2008

dw - This is very interesting article on an unintened (but positive) impact of having a 10b5-1 plan for an officer

http://www.fundmymutualfund.com/2008/07/mercadolibre-meli-up-15-on-termination.html

Mercadolibre (MELI) up 15% on Termination of CEO Stock Sale

What a day - rarely do you get four 15%+ movers. Mercadolibre (MELI) which has been hit with the ugly stick (I've stuck with it), is rallying from a very oversold level on news the CEO won't be selling a 1.8 million load of stock. Analysts are happy.
Myself, I am sort of getting tired of this stock since either they are
doing a proposed share dilution and that kills the stock or their
management gets greedy (like all good public companies) and showers the
public with shares so they can buy their 18th house.... err, I mean
fund a good college education for their children. We've taken a bath
here (actually a bath in every room in one of MELI's CEO's mansions)
but it still is a very uniquely positioned company. I wish management
would play along - unfortunately there is no peer we can switch to with
a more shareholder friendly management. If these people would be a
little less greedy "today", we could all win "in the long run". At this
point I'll just be looking to lighten the position as it heads
(hopefully) back to upper $30s. This is a potential crown jewel being
mishandled. I was hoping Ebay (EBAY) would of bought it by now and taken me out in the $70s.

I
will say it is nice to see analysts defend a stock after a 50% haircut,
unlike a certain mismanaged solar company that falls in half and
analysts stand to the side laughing. Goldman is even so kind to
downgrade it after a 50% drop! Thanks! I won't name it, but it rhymes
with Leena Troller. Not that I'm bitter.
As you can see people, management is a big issue with publicly traded
companies. Those with the best ones get valuations that are in excess
of their peers.

• MercadoLibre (MELI) shares are on the mend today after CEO Marco Gaperin disclosed in an 8-K filing with the SEC late yesterday
  that he has terminated a stock selling plan under rule 10b5-1 which had
  been installed on May 20. Under the plan, Gaperin was to sell up to
  1,768,794 of his MELI shares.


• Stifel Nicolaus analyst Scott Devitt notes that since he had filed the plan, MELI’s share price has been cut in half, from $54 to $27.
  He contends the sell-off is overdone, and that the termination of the
  CEO’s stock selling plan could provide a catalyst for the stock. He
  notes that Galperin has owned a position in the stock since it was
  founded in 1999; he owns a 12% stake worth $197 million as of
  yesterday’s close.


• Imran Khan, an analyst with J.P. Morgan,
  asserted this morning that the recent sell-off “has created a buying
  opportunity” in MELI shares. He says Q2 numbers should be strong; he
  expects revenue of $32.3 million and EPS of 8 cents. Khan says checks
  find 20% sequential listings growth.


• Tim Boyd, an analyst with American Technology Research,
  likewise contends the selling in MELI has gotten out of hand. “I don’t
  think the stock is down for any reason other than it’s a high-multiple
  growth stock with no real catalyst between now and the Q2 report and
  investor psychology is horrible,” Boyd wrote to Tech Trader Daily in
  response to a query on the recent slide in the stock. “I have very high
  conviction in a strong Q2 report and [management’s] body language has
  been unequivocally positive over the last two months. It’s a scary
  stock right now, but a must-own down here. I think earnings gets us
  back above $40 easily. News of CEO canceling his 10b5-1 plan (which I have never seen before) triggers short squeeze today.”