Should You Sell Reynolds American (RAI) Stock?

Hasn’t it been interesting to see how much insider selling has happened at Reynolds American since the announcement of the Lorillard merger?

Martin Holton III, General Counsel, has sold shares. Murray Kessler, a director, has sold hundreds of thousands of shares. Thomas Wajnert, a director, has sold tens of thousands of shares. Daniel Herko, whose official title is unclear, has sold tens of thousands of shares. Richard Thornburgh, a director, has sold tens of thousands of shares. Jeffery Gentry, an executive manager, has sold tens of thousands of shares. Debra Ann Crew has sold tens of thousands of shares. Andrew Gilchrist, the CFO, has sold tens of thousands of shares.

Is this rush to prune shares of the combined tobacco giant merely coincidental estate planning, or is it a signal that the stock has gotten a bit overvalued?

From 1989 through through 2011, Reynolds American traded at a valuation range … Read the rest of this article!