Insiders at the Magnificent Seven tech companies are following Jeff Bezos and Mark Zuckerberg in realizing gains from the stocks that have largely powered the boom in US equity markets.
Almost a dozen executives and directors at the firms recently boosted their share sales, earning more than $160 million since late 2023 after not cutting their stakes in as long as nine years, according to data compiled by Bloomberg.
Take Alphabet Inc. Chief Executive Officer Sundar Pichai. He’s already sold more stock in Google’s parent company this year than in all of 2023, pocketing $30 million overall from almost two dozen sales filed as recently as this month. Alphabet’s shares have gained more than 90% since the start of last year.
Nvidia Inc. director Mark Perry has sold more stock so far this year than in the previous two years. And Apple Inc. Chairman Arthur Levinson filed in February to offload his biggest chunk of the iPhone-maker’s stock in more than two decades.
A representative for Alphabet said Pichai’s sales were done through a trading plan. Nvidia declined to comment, while Apple didn’t respond to a request for comment.
The moves underscore how Silicon Valley insiders are monetizing their holdings after tech stocks rallied to fresh records, rebounding from a 2022 slump caused by accelerating inflation and interest-rate hikes. Nvidia is the best performer among the Magnificent Seven stocks — and third-best on the S&P 500 Index — this year with an 83% gain.
“They all understand that pigs get fat and hogs get slaughtered,” said Lloyd Greif, founder of Los Angeles-based investment bank Greif & Co. “No one can time the top of the stock market perfectly, and it certainly looks pretty frothy right now.”
The cohort of seven tech companies that also includes Amazon.com Inc., Microsoft Corp., Meta Platforms Inc. and Tesla Inc. has risen nearly 150% since the start of last year, partly because of investors’ appetite for any stocks that offer exposure to artificial intelligence.
Recent quarterly earnings showed the rally still has legs, with all except Meta gaining after their reports. Nvidia, scheduled to report later this month, is the only Magnificent Seven company that has yet to release results.
Even insiders in the companies that aren’t doing well are selling. Unlike its Magnificent Seven peers, Tesla’s share price has slumped this year but that hasn’t stopped Chair Robyn Denholm filing this year to sell about $52 million of the electric-vehicle maker’s stock after not touching her stake since 2022.
The Australian native, who filed a 10b5-1 trading plan in October to help her unload stock options expiring this year, joined Tesla’s board in August 2014. The company’s shares have climbed more than 800% since the end of that month, meaning she’s most likely sitting on big gains even with the recent slump.
Tesla didn’t respond to a request for comment.
Bezos, Zuckerberg
The biggest overall winner from the Magnificent Seven’s recent rally is Amazon founder Bezos, who netted about $8.5 billion unloading stock over less than two weeks in February. The sales, his first since 2021, came shortly after he announced that he was moving to tax-free Florida from Washington state, which recently introduced a capital gains tax.
Zuckerberg’s trust as well as entities for his charitable and political giving began unloading shares through a trading plan in November and they’ve since filed to sell more than $1 billion worth. The latest of those sales was well timed, as Meta’s stock price has since fallen about 5% since then.
A representative for Zuckerberg said he mainly sells shares through trading plans to fund his and his wife Priscilla Chan’s philanthropy.
Bezos, 60, and Zuckerberg, 39, have a combined fortune of about $378 billion, with most of their wealth still tied up in their Amazon and Meta stakes, according to the Bloomberg Billionaires Index.
Put all the insider transactions together, and “you feel they are calling a bit of the top of the market,” said Claire Madden, managing partner of London-based private equity firm Connection Capital.
Some top leaders are offloading shares for the first time.
Alphabet President Ruth Porat netted about $6.6 million selling shares in the search-engine giant in March, her first ever sales since she joined the Silicon Valley company in 2015 after spending more than two decades at Morgan Stanley.
Alphabet’s stock has surged more than 500% since Porat swapped Wall Street for California. With US presidential elections later this year and the Federal Reserve indicating it’s not cutting interest rates just yet, it’s not surprising many insiders are cashing in on the recent rally, Greif said.
“No one wants to get caught standing in a game of musical chairs when the music stops,” he said.
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