INSIDER SELLING HITS NEW 2010 HIGH

The recent uptick in stocks has not been met with much enthusiasm by corporate insiders.  In fact, pessimism rules the day in the land of insider buying and selling trends.  For the week ending February 26th insiders sold a total of $1.88B in stock and purchased just $13.22MM.  Selling was up substantially from last week and buying was down substantially from last week.  The selling was the highest level experienced this year.  Interestingly, as the rally has continued insiders have actually increased their selling.

Of course, insiders sell for numerous reasons so it’s foolish to look at insider selling alone, however, the low level of buying tells the real story here.  Insiders simply don’t trust the long-term viability of the equity rally based on the condition of their internal operations.  Perhaps most alarming in this data is the fact that it is not solely a problem in the United States.  As we noted last week, the problem is pervasive in China as well where insider buying and selling trends remain negative.   Clearly, Main Street investors aren’t the only ones aware of the government induced rally in stocks.  The stimulus based recovery in China is apparently causing some concern in the corner offices in Hong Kong as well.

There was no notable buying this week, however, there were some interesting trends in selling.  Sales across the consumer discretionary space we particularly heavy.   Selling was very heavy in Whole Foods (WFMI) where insiders clearly desire to take profits following the 25%+ rally in recent weeks.  Other notable sales included sizable selling by the CFO’s of TJX and VF Corp.   As we’ve previously mentioned, sales by CFO’s are always intriguing because no insider knows the company finances like the CFO.   All notable buying ans selling is attached:

Notable selling:

Source: FinViz

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Cullen Roche

Mr. Roche is the Founder of Orcam Financial Group, LLC. Orcam is a financial services firm offering research, private advisory, institutional consulting and educational services.

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  • Charles

    Hi,

    Could you please provide a chart (for the last 4-10 years)? Daily insiders transactions for some months do not make a trend..

    Thanks and cheers,

  • Charles

    Hi,

    Could you please provide a chart (for the last 4-10 years)? Daily insiders transactions for some months do not make a trend..

    Thanks and cheers,

    (I am just posting again the comment to be notify when there is an answer)