Wall Street analysts are not taking kindly to recent moves by Tutor-Perini Corp., the Sylmar, Calif., contractor, that would allow its chairman and CEO, Ron Tutor, to sell off his shares, possibly to finance outside activities such as his investment stake in a Hollywood film studio, observers say. In a Sept. 13 federal filing, the firm's board agreed to allow Tutor to divest 100% of his shares as long as one buyer does not accumulate a 15% or higher ownership stake. He currently has a 25.2% stake, or 11.9 million shares.

The filing says the board removed most restrictions on Tutor's stock ownership, at his request, “to provide the flexibility to manage his portfolio in the manner he deems most appropriate.” Tutor had been restricted to selling only 65% of his shares, a figure the board allowed in June to rise from 40%, according to a June 2 filing.

Tutor leads an investor group called Filmyard Holdings, which bought the name and film library of Miramax Films in late 2010 from the Disney Corp. for $663 million. Filmyard outbid studio founders Harvey and Bob Weinstein. At the time, Tutor said in a published report the deal was “complicated.”

Avram Fisher, industry analyst for BMO Capital Markets, said on Sept. 20 the board's action “strikes us as a bit inconsistent,” coming one month after Tutor told analysts that he “hated every sale of stock I've made since the first one.” According to Fisher, Tutor said he had “one more [sale] that I have to make over the next 30 days to satisfy a final agreement.” The Tutor-Perini share price was $13.92 on Sept. 20, down from $38. 25 in April 2008, says Fisher. On Sept. 12, analyst Steven Fisher of UBS Investment Research (no relation) cut the firm share price target to $26 from $28. The lower multiple reflects market uncertainties and “increased risk of another CEO share sale overhang, given the change in agreement that was granted earlier this year,” he said.