Insiders at Nvidia, Palantir Technologies, and Meta Platforms have sold approximately $18.6 billion more stock than they bought over the past five years, according to Form 4 filings reviewed through Sept. 4. Buying from those same insiders has been almost nonexistent across all three companies.
Nvidia, Palantir, and Meta Platforms shares moved in different directions this week, with Nvidia up 0.84% and Meta up 1.00%, while Palantir fell 4.49%. But a longer-running signal from the people who run these companies is drawing more attention than the daily swings.
Five years of one-way trading
Securities law requires company insiders — executives, board members, and holders of at least 10% of outstanding shares — to file Form 4 with regulators within two business days of buying or selling stock. Those filings show a lopsided pattern at all three companies over the trailing five-year period.
Nvidia insiders were net sellers of $6.31 billion in stock, Palantir insiders sold a net $6.63 billion, and Meta insiders sold a net $5.69 billion, together adding up to approximately the $18.6 billion gap. Executives and board members are often compensated heavily in stock and options, and selling shares to cover tax bills is common. That means the selling alone isn't necessarily bad news for investors.
Buying has nearly disappeared
Insider purchases tell a starker story. Over the same five years, Nvidia insiders bought just $250,000 worth of shares, Palantir insiders bought $7,837,856, and Meta insiders bought none at all. Unlike selling, there's only one reason insiders buy shares: the belief that the price will rise.
The near-absence of buying may speak to the checkered history of next-big-thing technologies powering the stock market's rally. Every major innovation since the mid-1990s has gone through an early bubble-bursting phase, as investors overestimated how fast the technology would be adopted. Nothing so far suggests artificial intelligence is the exception.
Source: Motley Fool
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