ATLANTA (AP) _ A co-founder of ValuJet sold 1.5 million shares of his stock a little more than a week after a devastating crash in the Everglades, but he may have dumped the shares a day too soon.

Timothy P. Flynn of Las Vegas, one of the airline's four founders, sold the falling stock Monday, one day before the stock staged its strongest rally since the crash.

Flynn had to sell the stock to pay off money he borrowed to invest, ValuJet said. The company refused to say whether the loans were used to invest in ValuJet.

After falling $1.88 per share on Monday and extending the stock's fall to 37 percent since the crash, ValuJet rose $1.87 1/2 Tuesday to finish at $13.12 1/2 on the Nasdaq Stock Market.

Spokesman Gregg Kenyon said Flynn, who put up about $1 million to help start the company in 1992, wasn't giving up on ValuJet.

``This does not mean he has concerns about the financial strength of the company. He still owns 4.5 million shares of ValuJet,'' Kenyon said.

The company has 54.46 million shares outstanding. Before the sale, Flynn owned 5.98 million shares, or about 10.9 percent.

Flynn, who heads an investing company, remains on the ValuJet board and is expected to be re-elected Thursday at the company's annual stockholders' meeting, Kenyon said.

Flynn did not return phone calls to his Las Vegas office.

ValuJet said Flynn's sale was necessitated by a margin call. When an investor buys stock on margin, he puts up some money and borrows the rest, using the shares as collateral. If the price declines, the investor may have to come up with cash quickly or lose the stock.

Kenyon declined to say whether Flynn's margin call involved ValuJet stock, which has fallen sharply since last year when it reached about $35 a share. ``That's his personal business,'' Kenyon said.

Airline industry analyst Steven Lewins of Gruntal & Co. said Flynn's sale, which amounted to nearly 3 percent of the company's stock, was probably a factor in Monday's drop.

Securities and Exchange Commission spokesman John Heine said Flynn, as a board member, is subject to the same regulations covering stock sales as a corporate officer, although he has never been involved in managing the company.

As an insider, Heine said, Flynn is not permitted to sell stock based on knowledge obtained through his financial connection with ValuJet.

After the accident, ValuJet, which had grown rapidly since it began flying in 1993, announced it was cutting its schedule in half.

An airline industry consultant said ValuJet probably will be able to rebound from its current troubles.

``Temporarily there's a good deal of animosity toward an airline that's just had an accident,'' said Lee Howard, president of Airline Economics International Inc. ``But it's usually fairly short-lived. The traveling public has a short memory.''

Lewins agreed, saying ValuJet was in a strong cash position.

He said his biggest concern for ValuJet is the impact of politics.

``Will ValuJet's name be dragged through the mud because of presidential elections?'' he wondered. Republicans, he said, are likely to hurt ValuJet if they make targets of the Federal Aviation Administration and Transportation Secretary Federico Pena.