While Elon Musk and Mark Zuckerberg unload shares in their companies, corporate insiders are buying it up, reports an article in Bloomberg. In the last 30 days, at least 1300 executives and officers have bought shares from their own firms. At the same time, the number of sellers has stayed below the monthly average in 2021.
And while the current buying spree isn’t as robust as the bear market bottom in March 2020, it’s still a vote of confidence, the article contends, as well as proof that those with inside knowledge about of these companies are seeing deals.
On the flip side, insider selling has remained relatively muted, with reasons driving the sales ranging from high stock prices to possible tax hikes for the wealthy. Where the monthly average of sellers in 2021 has been roughly 2500, that dropped to 2400 in the past 30 days. That lower average is still above the number of buyers, even with the recent surge. Additionally, the buy-sell ratio of 0.58 wasn’t anywhere close to the peak reading of 2.19 during the pandemic dip, and is an improvement from the record low of 0.19 earlier this year.
This data might help calm some fears during this volatile period. The article points to the solid support from corporate earnings as firms continue to top estimates at a record rate, leaping over hurdles such as inflation and supply-chain disruptions. But investors shouldn’t take the data as carte blanche to pour their money into the broad market, as a fiscal slowdown is still likely in 2022.