Notable Insider Buys and Sells
UnitedHealth executives made significant stock purchases, with CEO Stephen Hemsley buying $25 million worth, indicating confidence in a business turnaround. CFO John Rex also increased his holdings by 9%. In contrast, Tesla chairwoman Robyn Denholm sold $198 million in stock, suggesting concerns about overvaluation. This disparity in executive actions highlights potential investment opportunities in companies like Humana, CVS Health, and General Motors, while raising concerns about compensation disparities within Tesla.
When an executive buys shares, especially after a major decline, it indicates a potential business turnaround.
After UnitedHealth (UNH) executive Stephen Hemsley took the CEO position, he bought $25 million in company shares. This is an approximately 8% increase to his 1.1 million shareholding. Similarly, CFO John Rex bought 17,200 UNH shares. This increases his holding by 9% to around 210,600 shares.
Both executive purchases make a bold statement. It should end the panicked selling in UNH stock. Investors may also consider Humana (HUM), CVS Health (CVS), Elevance (ELV), and Molina Healthcare (MOH).
In the electric vehicle sector, Tesla (TSLA) chairwoman Robyn Denholm sold approximately $198 million of stock in the last six months. This is a prearranged trading plan Denholm set, after CEO Elon Musk endorsed Donald Trump. After selling 1.4 million shares, Denholm owns 85,000 shares, plus 49,000 stock options.
The TSLA stock sale is a bearish sign. It suggests that the executive believes Tesla stock is richly valued compared to the industry. Readers may consider General Motors (GM) or Ford Motor (F) for deep value. Conversely, Stellantis (STLA) has headwinds selling Jeep vehicles. STLA stock will likely trade at a discount for longer.
Your Takeaway
The Tesla executive stock sale reminds workers of the compensation disparity. Engineers and designers are paid far less. The wide pay gap would discourage them from working in critical job roles that made Tesla a success in the first place.