High-profile CEOs, founders, and heirs are selling stock by the bucketload in the companies that made them billionaires. For nearly the entire bunch, share prices are trading near all-time highs.
Jeff Bezos sold Amazon shares worth $8.5 billion in multiple transactions this month. Meanwhile, Jamie Dimon, chairman and CEO of JPMorgan Chase, sold $150 million in stock last week, his first cash-out since taking the top job at the bank 18 years ago. Around the same time, Leon Black, cofounder and former CEO of Apollo Global Management, shed $172.8 million in stock—also a first-ever stock sale.
In dozens of trades since the beginning of February, Mark Zuckerberg unloaded about 1.4 million shares of Meta stock worth roughly $638 million, according to an analysis from insider stock sales data firm Verity. This latest batch of sales came after previously culling 588,200 shares in November, 688,400 in December, and 447,200 in January. He sold nearly $600 million worth in the three months leading up to February, and his proceeds from combined sales during the past four months have reached $1.2 billion.
Similarly, the trust for the Walton family, heirs to Walmart’s founder, sold $1.5 billion in Walmart stock this month. The family owns about 45% of Walmart’s shares, according to Bloomberg.
Many of the sales were made according to 10b5-1 trading plans that the executives set up late last year and early this year. These trading plans are created in advance so that shares are automatically sold by a broker at a specific date or when the stock hits a certain price. They’re set up to be triggered at a time when the executive doesn’t possess material nonpublic information that could potentially move the stock price and gives the executive a defense against potential insider-trading charges by regulators.
The sales come as the S&P 500 index is at an all-time high, rising 28% in the past year. The Nasdaq Composite index is up nearly 40% the past year.
Black, of Apollo Global Management, was the one founder of the bunch to sell outside of a 10b5-1 trading plan. His spokesperson said that the trade was made as part of routine tax and estate planning and to boost the growth of his family office, Elysium Management. The Walton family’s sales were also outside of a 10b5-1 plan. A 2015 statement from the Walton family said that its members will sell shares from “time to time” to curb increases in its ownership of the retail giant. The Waltons set up the trust that same year and told Walmart that it had no set timetable for sales of company stock.
Calm before the storm
Alan Johnson, a compensation consultant who works with financial services firms, said the stock sales could be the result of the election possibly shaking things up in the fall. Thus, if an executive is currently “more in the money” than expected, diversifying their holdings is a good idea. Plus, wealthy stockholders may be taking advantage of tax breaks implemented during the Trump administration, noted Johnson, in case they are eliminated under any new administration or Congress after the upcoming elections.
“If you’re reading the tea leaves and looking at what may happen with our politics in the next year or so, things are pretty good right now—the markets are up,” said Johnson, president of Johnson Associates. “With our politics and everything else going on geopolitically, maybe it won’t be as good a year from now or two years from now.”
As for Dimon, Johnson said the bank CEO is known for holding stock in the company, a tactic that has enriched him. Dimon’s net worth according to Forbes is $2.1 billion.
“The way he of course became fabulously wealthy was to get the stock, keep it, and have the stock price go up,” said Johnson. “What’s unusual about him selling is he’s doing it so late in his career.”
Most executives would have sold moderate amounts along the way, he explained. That doesn’t necessarily mean anything about Dimon’s tenure at the bank potentially having an end date, said Johnson.
“A joke I’ve used with clients is that, looking back 10 years from now, one of the questions we’ll be asking is, ‘Who is going to replace Jamie Dimon at JPMorgan?’” he said. “We’ve been asking that question for 10 years already.”
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FAQs
The Great Cash-Out: Jeff Bezos, Leon Black, Jamie Dimon, and the Walton family have now sold a combined $11 billion in company stock this month—some for the first time ever. Meta CEO Mark Zuckerberg has sold $1.2 billion in stock over the past four months.
Why are billionaires selling their shares? ›
"Billionaire CEOs like [Jeff] Bezos, [Mark] Zuckerberg, Jamie Dimon, and the Walton family are selling off massive amounts of their own stocks, and analysts think the CEOS may be bracing for an economic downturn," he said, adding, “An overheated stock market continues to climb to new heights as investors feed that ...
How much stock did the Walton family sell today? ›
Walton Family Sells $1.5 Billion of Walmart Stock After Rally - BNN Bloomberg.
What stocks is Jeff Bezos buying? ›
7 Stocks Jeff Bezos Is Buying
| Stock | Market capitalization | Year-to-date performance as of April 11 |
|---|
| Airbnb Inc. (ABNB) | $103 billion | 17.7% |
| Remitly Global Inc. (RELY) | $3.6 billion | 0.5% |
| Rivian Automotive Inc. (RIVN) | $9.1 billion | -59.2% |
| Sana Biotechnology Inc. (SANA) | $2.1 billion | 129.4% |
3 more rowsApr 12, 2024
Three of America's most prominent business leaders have been unloading shares of their respective companies over the past few months. Meta's (META) Mark Zuckerberg sold $400 million worth of stock in the final months of 2023, while Jeff Bezos sold Amazon (AMZN) stock worth an estimated $8.5 billion in February alone.
Who is the wealthiest person in the world? ›
Bernard Arnault, chairman of LVMH, is the richest person and the richest man in the world with a net worth of $215 billion. After Arnault is Jeff Bezos, founder of Amazon.
Why are big CEOs selling their stocks? ›
Why it matters: It makes sense even for billionaires to diversify out of having the overwhelming majority of their wealth in a single stock. Now's a great time to do just that. By the numbers: Between them, the three moguls have sold $9.3 billion of stock in less than a month, per Jonathan Moreland of Insider Insights.
Who owns 50% of Walmart? ›
It is a publicly traded family-owned business, as the company is controlled by the Walton family. Sam Walton's heirs own over 50 percent of Walmart through both their holding company Walton Enterprises and their individual holdings.
Who owns the biggest stock in Walmart? ›
FAQ. Jim Walton owns the most shares of Walmart (WMT).
Who owns the largest share of Walmart? ›
The Walton family owns about 45% of Walmart's outstanding shares through the trust and their main investment vehicle, Walton Enterprises, data compiled by Bloomberg show. Alice, Jim and Rob Walton have a combined fortune of $274 billion, according to the Bloomberg Billionaires Index.
He's following a prescribed plan available only to corporate insiders—and his recent cross-country move will reduce the transaction's tax bill. Bezos sold his shares as part of a predetermined process for selling company stock. And his recent move to Miami will ease the tax burden of that process.
What stocks does Bill Gates own? ›
CURRENT PORTFOLIO
| Ticker | Company | % Portfolio |
|---|
| MSFT | Microsoft Corp. | 33.98% |
| BRK.B | Berkshire Hathaway Inc. | 16.80% |
| CNI | Canadian National Railway Co. | 16.29% |
| WM | Waste Management Inc. | 14.92% |
18 more rowsMar 12, 2024
Experts say the sales make sense. Amazon's share price is up, and Bezos's recent move from Seattle to Miami means he can sell without worrying about Washington state's new capital gains tax. “It's an optimal time to make this move,” said Neil Saunders, managing director of analytics company GlobalData.
How do the rich use debt to avoid taxes? ›
Buy, Borrow, Die Strategy: This strategy involves buying appreciating assets, borrowing against them, and letting heirs inherit the assets to avoid capital gains tax. Managing Leverage Risks: Leveraging debt can increase wealth, but it also magnifies risk, liquidity issues, and costs, hence needs careful management.
How do the rich use debt and taxes to get richer? ›
Some examples include: Business Loans: Debt taken to expand a business by purchasing equipment, real estate, hiring more staff, etc. The expanded operations generate additional income that can cover the loan payments. Mortgages: Borrowed money used to purchase real estate that will generate rental income.
Should I get out of the stock market? ›
While holding or moving to cash might feel good mentally and help avoid short-term stock market volatility, it is unlikely to be wise over the long term. Once you cash out a stock that's dropped in price, you move from a paper loss to an actual loss.
Why is Zuckerberg selling meta shares? ›
Zuckerberg primarily sells Meta shares to fund philanthropic initiatives, according to company spokesperson. He has pledged to give away 99% of his stake to charitable purposes. Marc Benioff, Zuckerberg's peer in the tech world, also sold shares nearly every day in the second half of 2023.
Why do owners sell their shares? ›
Selling shares in a business can generate significant cash, which can be used to pay down debts or fund investments or charitable donations. Likewise, selling part of a business can reduce the owner's risk and allow them to diversify their personal assets. Business owners may have several other reasons to sell shares.
Are CEOs dumping stock? ›
CEOs are selling off millions of dollars of their own stock.
According to Fortune, Jeff Bezos, Mark Zuckerberg, and Jamie Dimon are among the billionaires selling off billions of dollars of stock.
Who buys the shares when everyone is selling? ›
But there's one group of investors who charge in to buy when stocks are selling off: the corporate insiders. How do they do it? They have 2 key advantages over you and me that provide them the edge during uncertain times. If you follow their lead, you can have that edge too.
