Insider buying is often seen as a sign those in the know are bullish on their company's stock. So, what might the market make of a $9 million sell-down of Wesfarmers Ltd (ASX: WES) shares conducted by the company's CEO?
Let's dive into why the boss of the S&P/ASX 200 Index (ASX: XJO) retail conglomerate behind iconic Aussie brands, including Bunnings, Kmart, and Officeworks, offloaded a significant parcel of the company's shares this week.
The Wesfarmers share price was trading at $52.65 when the market closed on Friday.
That's 1.2% lower than the 52-week high of $52.30 the company hit on Wednesday, which saw it trading 15% higher than it started the year.
Wesfarmers' boss sells $9m parcel of stock
Wesfarmers CEO and managing director Rob Scott sold down a whopping 174,383-strong parcel of the company's shares earlier this week to fund tax obligations. He sold the chunk for between $51.80 and $51.88 apiece.
The tax obligations facing Scott arose from stocks issued under the company's Key Executive Equity Performance Plan (KEEPP). The shares sold were held on behalf of both Scott and his wife Elizabeth.
It's worth noting that the insider still boasts a significant chunk of the company's stock following the sell-down. He holds approximately 3,800 shares directly and around 1.08 million stocks in total.
Interestingly, Scott's wasn't the only selling action going down at the company this week.
Wesfarmers announced it had sold its remaining 2.8% stake in Coles Group Ltd (ASX: COL) on Wednesday, my Fool colleague Sebastian reports.
The supermarket operator was acquired by the retail-focused conglomerate in 2007 before being spun out in 2018. The sale of Wesfarmers' remaining stake in Coles is rumoured to have brought in $688 million.
Wesfarmers share price snapshot
The Wesfarmers share price has been on a roll lately.
The stock is currently trading 14% higher than it was at the start of 2023. It has also gained 6% since this time last year.
Meanwhile, the ASX 200 has risen 6% this year and has fallen 3% over the last 12 months.
