Interesting - Menu Foods Stock Trading Volume

[finecraft]

If I am incorrect, someone please correct me. I find this a bit odd - Menu Foods (Lethal pet food maker) trades on the Canadian stock exchange under the ticker symbol MEW.UN. Their average daily trading volume for the past 6 months is around 90,000 shares per day.

http://finance.yahoo.com/q/hp?s=MEW-UN.TO

This average includes a sell-off of stock after the poison food recall was announced. Prior to that, the stock traded around 20,000 shares per day. Looking at the trading volumes for the stock, there were two big days of very active trading prior to the public announcement of the food recall. One was February 8, 2007 when 400,000 shares were traded. The other was February 5, 2007, when 281,000 shares were traded.

15-Feb-07 29,700
14-Feb-07 31,400
13-Feb-07 3,100
12-Feb-07 3,600
9-Feb-07 5,700
8-Feb-07 400,000
7-Feb-07 500
6-Feb-07 1,800
5-Feb-07 281,400
2-Feb-07 100
1-Feb-07 4,000
31-Jan-07 900
30-Jan-07 0
29-Jan-07 1,200
26-Jan-07 3,500
25-Jan-07 5,500


I seem to remember an article that stated that the company was aware of food quality issues sometime in February. I think I smell some insider trading going on. (Calling Martha Stewart!!)Anyone have access to Canadian stock market information to check if there is any insider sales data?

[lazer47]

1. That is just investors selling off their stock or dumping it

[buzzard]

2. It could also be an insider.

[HCE SuiGeneris]

4. What do you mean? Anyone that has stock is an investor.

If huge volumes are being traded prior to release of detrimental information coming out about the company, don't you think it warrants a closer look?

[finecraft]

6. That's at least a month before public announcement of tainted food

I don't think the investors would have known anything was going on with regard to tainted pet food.

[havocmom]

9. Martha went to jail for less- looks like insider trading. Needs investigating.

x(

[northzax]

15. no, Martha went to jail for lying

not for her trading.

[leftofthedial]

24. *before* the recall?

:shrug:

smells fishy

[blondie58]

3. somethings rotten in Denmark- I mean, Canada

this seems really fishy. And of course, many employees own a lot of stock. It should be investigated.

[AZBlue]

5. Officially, they first found out about it Feb. 20th.

Unoficially, some reports say it could have been as early as Dec. or Jan.

[finecraft]

7. Thanks for the info!

I couldn't find anything that said what time frame they started suspecting their food had problems, but I seemed to remember it was sometime in February.

[ms liberty]

8. This part looks interesting to me...

The first big sell-off was on 05 Feb, a Monday
Then the 2nd one comes on 08 Feb, a Thursday - 3 business days later

All completed within the same business week.

[TahitiNut]

10. It's a myth that 'insider trading' is prevented.

When they became aware of the looming scandal, they undoubtedly warned the major holders. Investment bankers and major stockholders can do far more than merely sell on such news to protect their positions.

I have firsthand experience with the executives of a Fortune 50 corporation delaying a major business transaction in order to delay a stock price plummet ... permitting them to exercise (and sell) options and make sure the major stock holders 'prepared.' After the trasaction was made public, the price of the stock fell like a stone. The executives, in just churning their options, made over $150 million more by trading before the fall.

[Morgana LaFey]

29. Have you seen this?

JIM CRAMER admits to hedge fund crimes, stock prices are "fictions"
http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=389&topic_id=468778&mesg_id=468778

Not quite what you said, but related malfeasance.

[TahitiNut]

31. I hadn't seen that but it's pretty much on target.

As an internal auditor for over 5 years, and an IT/MIS person most of my career, everything I've seen and understand make that an inescapable conclusion. *Nothing* is more important than maintaining the fiction. "Perception is reality." The Greater Fool Theory rules the market. (That's why it's a "seller's market" 95% of the time.) The "fundamentals" have become less than 20% of what makes the large trades 'tick.' The instance of stock fraud I helped uncover involved the head of the largest investment banking firm in the world - who was a member of the Board and the Audit Committee. It's sad to face the fact that the corruption is so pervasive - my "loss of innocence." People who play roles in it are largely clueless dunces, in deep denial, or gleefully complicit. I shudder to even think back on it.

[LoZoccolo]

11. The stock is very thinly traded to begin with; there are spikes like that all over.

Go back the entire year previous and you'll see them throughout.

On the 5th, the stock actually gained; it did not look back from it's opening low that day.

And the quarterly results were announced on the 7th; I'd expect to see action on a thinly-traded stock after an earnings report.

[northzax]

17. it's so thinly traded

that check out late September of 06, three straight days when ZERO shares traded.

there are only 19,000,000 shares outstanding,

ok, solved the question. a company called AGF Management (an equity firm) in Toronto owned about 20% of the company. another family owned a collective 10%. AGF looks like it has been slowly selling its stake over the past year, which explains many of the spikes. frankly, there aren't enough insider shares to explain those two large spikes as insider trading, unless AGF did it, without reporting it, which is too blatently obvious.

[Dover]

12. What investigative writer would follow up on this?

Krugman, Jason Leopold, someone from Salon or The Nation...?

[earth mom]

13. Looks very suspicious to me.

Wonder if anyone will bother to investigate it? It's not like Martha Stewart is doing the illegal trading. :sarcasm:

[roamer65]

14. If I owned it, I'd be dumping every share of it.

They're going to go bankrupt with all of the lawsuits.

[kestrel91316]

16. If it's traded on the Canadian Stock Exchange, doesn't that mean

it's really none of America or American's business? I don't think US securities regulations apply to the CSE.

Just wondering.

Frankly, it looks to me like a huge insider trade when somebody at Menu Foods got wind of the problem, and knew about questionable supply sources.........

[northzax]

18. legally, sure, none of the US' business

morally and ethically? it's an interesting problem. And it is a firm that does business in the US and employs people in the US-

[kestrel91316]

19. Yep. But I think its a waste of Americans' energy to be barking

up a Canadian "insider trading" tree.

[northzax]

20. unless it shows bad faith

if the leadership of the firm knew, in advance of the disclosure of information that there was a serious problem, they had an obligation to release it then, given that this was not only a potential financial problem, but one that was causing deaths among domestic animals.

[kestrel91316]

21. Excellent point. And i hate to think what the Canadian version of

the SEC will do to these folks.

[havocmom]

22. Kick for the analysts out there on the day shift

:kick:

[nicknameless]

23. It has been reported that the company began receiving complaints in Dec.

I wonder what the trading activity looked like going back that far... or to November.

K&R

[TZ]

28. could it be employees dumping stocks?

A lot of big companies offer stock options to employees both for 401K and just in general. I think that outside of a certain block of time around the time of quarterly and yearly results employees can sell stocks whenever they want. I think they just legally can't say why. I would bet there were a lot of people at Menu who knew something were going down but couldn't legally say anything and knew it was time to get out. I don't think thats insider trading at all but again I am not a financial expert, just kind of drawing on my own experiences working for companies with public stock.

[nicknameless]

35. I don't know. I'd only be guessing.

:shrug:

[Critters2]

25. Good Lord!! Look at Feb 8th!!!

Somebody knew something well before this broke publicly.

Now I'm REALLY pissed!!!:mad:

[ends_dont_justify]

26. I wonder who bought so much of it?

Jan 15, Jan 18, Feb 5, Feb 8, Then march 16th-onward. Why does it seem someone is now rapidly buying their stock after known contaminations? Seems like at certain coincidential moments, someone had a vested interest...

[rec_report]

27. I just gave you your fifth recommendation - this hits 'Greatest' page. n/t

[hvn_nbr_2]

30. Any Harken Energy board members on Menu's board? :-) nt

[w4rma]

32. They probably took so long in announcing the recall to have time to slowly rid themselves of their

stock, hoping noone would notice if they did it slow.

[Shallah Kali]

33. Got data any further back? was told local news said reports of deaths go back 6 months

.

[gravity]

34. That's interesting, but nothing out of the ordinary

I've just checked and it looks like that Menu foods has had high volume days in the past though. I bet it's just an institution buying or selling large quantities of stock.

Nov 8, 2006 had a spike that went up to 568k in volume and there were other high spikes before that too.