The stock market’s rally since the March 23 low has been stunning. The S&P 500 is up nearly 30% from those levels as of yesterday’s close. So it’s not surprising that insider selling has accelerated into the rally.
Insiders were big net buyers during the panic selling last month. For the week ending March 13, the WhaleWisdom Insider Weekly Sell vs Buy ratio hit 0.23. As we wrote at the time, that’s a level of insider bullishness only surpassed in November of 2008. And the next two weeks were also very bullish, showing ratios of 0.43 and 0.63. Only last week did we see a definite uptick in insider selling. For the week ending April 10, the reading was 2.82.
The Insider Sell vs Buy ratio reflects the number of officers and directors buying stock on the open market vs those selling. When key insiders are broadly buying stock in their own companies, and selling very little, history shows that the stock market is approaching a bottom. The insiders definitely called the March bottom. Whether it’s THE bottom — or whether stocks revisit those lows in the weeks ahead — remains to be seen.
In any case, C-level insiders at the following companies have been taking advantage of the bounce in their shares to do some notable selling. To what degree the selling reflects bearishness on the part of the insiders is hard to decipher. Keep in mind that insider selling is generally less predictive than insider buying. Insiders sell stocks for many reasons — portfolio rebalancing, liquidity needs, and to cash-in employment-based stock options. But insiders only buy because they think their stock will eventually trade higher. Still, when a key insider sells a large % of their holdings, it does make you wonder…
Stocks showing significant selling by one or more C-level insiders over the last two weeks. Source: WhaleWisdom.com
| Recent Filing | Company | Symbol | Industry | # Insiders | Last Trade | Total Shares | Avg. Price | Total |
| 09-Apr-2020 | Zoom Video Communications | ZM | Services-Computer | 2 | 08-Apr-2020 | 331,216 | 141.08 | $ 46,729,408 |
| 10-Apr-2020 | Crowdstrike Holdings, Inc. | CRWD | Software | 2 | 09-Apr-2020 | 574,498 | 59.74 | $ 34,320,112 |
| 10-Apr-2020 | Digital Realty Trust Inc. | DLR | REIT | 3 | 09-Apr-2020 | 108,024 | 144.49 | $ 15,608,350 |
| 09-Apr-2020 | Apple Inc. | AAPL | Personal Computers | 1 | 07-Apr-2020 | 41,062 | 264.44 | $ 10,858,444 |
| 03-Apr-2020 | Datadog, Inc. | DDOG | Software | 3 | 01-Apr-2020 | 210,099 | 35.26 | $ 7,407,937 |
| 08-Apr-2020 | Cloudflare, Inc. | NET | Software | 2 | 08-Apr-2020 | 221,100 | 23.36 | $ 5,165,619 |
| 10-Apr-2020 | Acceleron Pharma Inc | XLRN | Biotechnology | 1 | 09-Apr-2020 | 54,000 | 86.37 | $ 4,663,775 |
| 10-Apr-2020 | Grocery Outlet Holding Corp. | GO | Grocery Stores | 2 | 08-Apr-2020 | 82,698 | 36.79 | $ 3,042,108 |
| 03-Apr-2020 | Karuna Therapeutics | KRTX | Pharmaceutical | 2 | 01-Apr-2020 | 32,728 | 65.08 | $ 2,129,808 |
| 07-Apr-2020 | Masimo Corp | MASI | Medical Appliances & Equipment | 2 | 06-Apr-2020 | 9,000 | 184.67 | $ 1,662,000 |
| 03-Apr-2020 | 10x Genomics, Inc. | TXG | Lab Instruments | 2 | 01-Apr-2020 | 27,000 | 58.07 | $ 1,567,884 |
| 10-Apr-2020 | Smartsheet Inc | SMAR | Software | 2 | 09-Apr-2020 | 25,000 | 44.65 | $ 1,116,137 |
| 10-Apr-2020 | Inspire Medical Systems, Inc. | INSP | Medical Instruments | 1 | 09-Apr-2020 | 10,000 | 64 | $ 640,000 |
| 03-Apr-2020 | Veeva Systems Inc | VEEV | Application Software | 1 | 02-Apr-2020 | 3,071 | 156.7 | $ 481,231 |
| 09-Apr-2020 | Dicerna Pharmaceuticals | DRNA | Biotechnology | 1 | 07-Apr-2020 | 20,469 | 19.95 | $ 408,357 |
| 08-Apr-2020 | Adaptive Biotechnologies | ADPT | Biologic Products | 1 | 08-Apr-2020 | 15,000 | 24.47 | $ 367,029 |
| 09-Apr-2020 | Hill-Rom Holdings, Inc. | HRC | Medical Instruments & Supplies | 1 | 07-Apr-2020 | 3,189 | 110 | $ 350,790 |
You can follow insider buying at the SEC’s Edgar website or at sites like WhaleWisdom.com.
Contact Mark about investing based on SEC filings and smart money disclosures.
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