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Apple Insiders Cash In

Wednesday, 28 Mar 2012 | 3:52 PM ET
Apple
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Apple

If you’re a top executive at Apple, all that hard work is definitely paying off. In hundreds of millions of dollars worth of stock.

Stock sales happen all the time, but it’s worth paying attention when the most valuable company in the world is hitting all-time highs and insiders are making good. In this case it’s the highest-ranking execs at Apple, including CEO Tim Cook.

According to filings with the SEC yesterday, five top executives at Apple sold more than $300 million worth of stock, most of it in the last few days.

I’d be careful about reading too much into these stock sales, most of which happened this week — this isn’t necessarily the type of selling pattern that makes stock watchers wary that there’s any kind of problem. That’s because the executives mostly sold restricted stock units, or RSUs, that were awarded a little more than four years ago, and didn’t fully vest until this week.

Apple tends to make these stock awards in two-year increments, they mature after four years, and they are the major component of executive pay. According to Apple’s proxy, “The Company believes long-term equity awards in the form of RSUs are the most effective way to attract and retain a talented executive team and align executives’ interests with those of shareholders.”

What’s interesting about the two-year grant cycle, I think, is that Apple tends to develop products in 15-month cycles, give or take. So when the top executives initially get a stock grant, their value is not so much tied to the performance of the products Apple even has on the drawing board today.

In this case, these stock sales reflect the amazing run Apple stock has had over the last four years, as the iPhone has become a global icon and the iPad has shaken up the mobile computing landscape. Keep in mind: When this stock was granted in the fall of 2008, the iPhone 3G had just come out, and it wasn’t yet clear whether it would really catch on. Apple stock traded at about $100 per share.

So, how much did Apple execs make?

Cook cashed in the most shares, more than 237 thousand shares, the large majority of them at around $600 a share. That’s probably worth about $140 million.

CFO Peter Oppenheimer sold 150,000 shares, worth about $90 million.

Marketing chief Phil Schiller sold shares worth about $72 million.

Hardware chief Bob Mansfield and mobile software chief Scott Forstall each sold more than $33 million worth of shares.

email: tech@cnbc.com

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