Resumen de Sales of secondary shares in SEOS: : A comparison across top managers, other insiders, and outsiders

Sinan Gokkaya, Michael J. Highfield, John Robert Warren

• This paper investigates the information content of registered insider sales in the Seasoned Equity Offering (SEO) process from 1997 to 2009. We find that initial market reactions and long-run post-issue stock performance are negatively related to C-level executive insider sales, but unrelated to participation by nonexecutive insiders. We also find significantly lower post-issue abnormal earnings surprises for SEOs with C-level executive sales. Overall, the findings are consistent with the predictions of asymmetric information and agency theories.