NigelM - I agree with you that 10b5-1 sales are nothing to worry about and good corporate governance. Heck, I just put half my money in GTAT, right after the CEO sold about 100,000 shares via a 10b5-1. But in the case of SCTY, I see something
EXTREMELY WRONG with Lyndon Rives sale of 120,000 shares; let me connect the dots for you guys:
You guys remember last October when SCTY was trying to raise capital, and they couldn't get enough interest from people to buy the shares (not sure if the last part is true, but my understanding was that they couldn't get interest)? So SCTY, completely out of left field, decided to issue 2015 guidance in order to jack up the stock price to raise more capital. On top of that Elon Musk and Lyndon Rive agreed to buy 560,000 shares of SCTY as part of the capital raise to
show the rest of the investment community that they have faith in SCTY. Well in the end the bought
less than 400,000 shares, o/w Lyndon Rive bought 107,434 shares.
If what NigelM says is true that Lyndon Rive put his 10b5-1 plan in place last August (just a couple months before the capital raise) to sell 120,000 shares of SCTY (just 8 months after the huge "vote of confidence"
that Lyndon Rive gave SCTY by buying 107,434 shares), then this whole thing is a slap in the face for SCTY shareholders and Lyndon Rive is a joke and making a complete mockery out of investors and shareholders.
SCTY already diluted the heck out of shareholders by doubling share count over the past 2 years, and now we see that they are dishonest and misleading shareholders by playing these "vote of confidence" games. I am sure that Elon does have confidence in SCTY, and probably will not be selling his shares. But what Lyndon, the CEO, did is completely unethical and the guy is a joke in my book for trying to fool shareholders. The truth always comes out, and I am always happy to do the detective work to point out these jokesters.
Disclosure: I just recently cashed out my deep ITM SCTY J15 30/40 Bull Call Spread for 92% of max value (I wanted to hold to maturity, or at least Sep. for LTCG, but I needed to raise capital somehow to buy more GTAT on this illegally fabricated pullback by UBS, who had notes due July 10-15 that cost UBS a lot more money the higher GTAT's stock price was. This is another example on Wall St. how the big players, i.e. CEO's and investment banks, screw over the little guy, i.e. retail investor. But I digress). Therefore, I now do not have any SCTY positions, and absolutely do not have any short positions in the stock either. But I do hope that the stock keeps going up, because I will be looking for an entry point to short once it goes all bubbly again. At the same time, I will go long the stock if it crashes another 30%. I think that SCTY is a good trading vehicle. I actually think that the stock will be a lot higher 5-10 years from now, but fear that there is a 20%-30% chance that the business model will fail the shareholders, i.e. not deliver decent returns, and therefore I don't buy as a long-term investment due to huge perceived risks.
But the main reason I am not a fan of SCTY, because they are an unethical company as proven by this hole capital raising mockery they made out of shareholders, ripping off customers by pocketing the whole benefit of installing a solar system for themselves while the customer is left holding the bag on a lease in the form of depreciated home value due to solar lease
(yes your house may lose as much as 10% in value due to solar lease, while owning a system can increase your property value by up to $25,000); note I am not a fan of SPWR (or any other company) leasing either. On top of that they screw over the taxpayers by jacking up the "appraised" system value price in order to maximize MACRS depreciation, so that Goldman Sachs can pay less in taxes and screw over the taxpayers (just what we need: an investment bank screwing over the taxpayers even more).
I am sorry, but SolarCity is a complete joke of a company to me! Extremely unethical in my book...
edit: jacking up the "appraised" solar system value price also means that SCTY is screwing the taxpayers over by pocketing 30% on this higher "appraised" value than the actual value of the system, which would be a much lower value; but that would mean less taxpayer dollars for SCTY to pocket for their own coffers, so that the executives can get their tens/hundreds of millions of dollars.
Also, make sure to read my hyperlink in the last paragraph about how solar leases can significantly lower the value of your home during resale, and how owning a system can actually increase the value of your home (I point I have been arguing here for over a year).
I am not a solar installer, and I have no positions in SCTY. Everything I write here is my own, unbiased, and honest opinion on this matter; and I understand that many people will disagree with me. That is what makes a market...