In a recent Form 4 filed with the U.S. Securities and Exchange Commission, Hagedorn Partnership, L.P. disclosed the sale of 44,793 shares of Scotts Miracle-Gro Company (NYSE:SMG) for a cash-out of approximately $3,483,109.28.
Insider selling is often considered to be a bearish signal for companies. Since officers and directors of companies have the most complete picture of what is going on inside of their organization, their transactions in their own company’s stock become useful signals for traders and investors.
What’s Going on at Scotts?
Back on July 24th, Jim Cramer covered Scotts Miracle-Gro on CNBC’s Mad Money Lightening Round, where he noted that Scotts is no longer the “pot play” of choice, and that investors should move their attention to “real pot plays now.”
Just a few days later, Scotts Miracle-Gro Company released its fiscal third quarter financial results, which showed that excluding the impact of acquisitions, sales in Scott’s cannabis-focused division declined 37 percent during the quarter.
During the conference call covering the quarter’s poor performance, Scotts Miracle-Gro CEO Jim Hagedorn “slammed the company’s cannabis-growing business in a curse-filled rant.”
“When people ask me what do you think about those numbers that came back from Hawthorne, I said ‘it’s a f*ing negotiation'” – Scotts Miracle-Gro CEO Jim Hagedorn
Then company released a statement saying its “board had unanimously reprimanded Mr. Hagedorn.”
To make matters worse, three independent directors decided to resign following the matter.
The Hagedorn Family Still Owns a Ton of Scotts
Following the sales, Hagedorn Partnership, L.P. still owns 15,625,196 shares of SMG. With approximately 55,366,000 shares outstanding, that’s approximately 28.22% of Scotts.
We’re not sure what’s going on over at Scotts Miracle-Gro, but with a recently announced cash dividend of $0.55 per share payable Monday, September 10th, Hagedorn Partnership, L.P. is in for a juicy $8,593,857.80 check.
That should be enough to keep Jim Hagedorn’s private camoflauged Cessna Citation fueled up for his 500 mile commute every day.
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