Strong rallies in popular AI plays prompt increased insider selling

The red-hot rallies in some of the biggest artificial intelligence plays have prompted a slew of company insiders to take profits in their own technology darlings. The excitement surrounding AI has been the driving force behind the stock market, pushing all three major averages to record highs. Major players in the space have pulled off a jaw-dropping performance over the past year, including key enabler Nvidia , which now boasts a $2 trillion market cap. Even with the huge run-up, many don’t see the uptrend reversing anytime soon, especially as the Federal Reserve’s hiking cycle comes to an end. But many insiders at these AI companies took advantage of the rallies, selling a portion of their stakes for a profit. Some of these sales were part of a 10b5-1 plan , which allows insiders to sell shares under a prearranged structure. Nvidia Nvidia is the leader of the pack with shares surging more than 70% year to date, following a nearly 240% advance last year. A number of directors at the company sold shares in late February amid the fierce rally. Mark Stevens (director) sold 15,000 shares Michael McCaffery (director) sold 4,000 shares Mark Perry (director) sold 15,000 shares Harvey Jones (director) sold 65,000 shares The chip giant recently reported earnings that beat Wall Street expectations and issued robust revenue guidance. NVDA 1Y mountain Nvidia Nvidia has been the primary beneficiary of the recent technology industry obsession with large artificial intelligence models, which are developed on the company’s pricey graphics processors for servers. Meta Platforms Meta CEO Mark Zuckerberg trimmed his stake in separate sales over the past week. His company shares have rallied nearly 40% this year Meta’s profit tripled in the fourth quarter, while revenue rose 25%, marking the fastest rate of growth for any period since mid-2021 as the online ad market rebounded. Mark Zuckerberg (CEO) sold 154,800 shares on March 1 Mark Zuckerberg (CEO) sold 232,200 shares on Feb. 28 A March 5 regulatory filing indicated that Zuckerberg sold another 77,412 shares on that same date. Investors cheered Meta’s decision to issue a dividend, a rare step for a high-growth technology company. They have also been focusing on Meta’s moves in AI. The company has a stake in the ground in AI with its LLaMA large language model, a competitor to Microsoft-backed OpenAI’s GPT-4. Super Micro Computer Super Micro Computer has been one of the biggest winners in the AI space, with the stock up more than 1,000% in the past year. SMCI 1Y mountain Super Micro Computer The server and computer infrastructure company got a boost recently after the announcement that it is set to join the S & P 500 benchmark on March 18, replacing Whirlpool. Super Micro has seen increased insider selling activity last month amid the stock’s dramatic rally. Sherman Tuan (director) sold 5,000 shares on Feb. 29 George Kao (SVP, operations) sold about 1,900 shares on Feb. 15 Don Clegg (SVP, worldwide sales) sold 28,000 shares in mid February. AMD Popular AI chipmaker Advanced Micro Devices also had a few insiders taking profits as of late, including CEO Lisa Su. Darla M. Smith (chief accounting officer) sold 1,700 shares on Feb. 29 Lisa Su (CEO) sold 125,000 shares on Feb. 21 Mark Papermaster (chief technology officer and EVP) sold 16,200 shares on Feb. 15 While that market is currently dominated by Nvidia, AMD has said that its new AI chips introduced last year will challenge Nvidia’s H100 GPUs for some applications. AMD said it saw “strong growth” in server GPU sales during the last quarter. Shares of AMD are up more than 39% this year. AMD 1Y mountain AMD Microsoft Microsoft CEO Satya Nadella trimmed his stake in the company on Friday in a planned sale. Satya Nadella (CEO) sold 1,300 shares on March 1 Bradford L. Smith (vice chair and president) sold 48,300 shares in early February. The software giant recently showed strong growth in its cloud business, which came faster than Amazon Web Services of late, thanks in part to its cozy OpenAI relationship.