Investors in Brainchip Holdings Ltd (ASX: BRN) shares have had a lot on their plate over the past year. For one, the Brainchip share price has been caught in a brutal vortex of selling pressure. It was only back in July last year that Brainchip reached a 52-week high of $1.36 a share.
But on Thursday, this ASX artificial intelligence (AI) share finished trading at just 35.5 cents each, down a nasty 74% from that 52-week high. And we won't even mention Brainchip shares' all-time high of nearly $2 a share that we saw in early 2022 (a loss of around 80% to today's pricing).
But unfortunately, there's some more potentially negative news to discuss today.
When an investor buys into an ASX share, they generally like to see the company's management have some 'skin in the game' and own significant portions of the company they are being paid handsomely to run. Conversely, those same investors don't like to see insiders selling out of 'their' company.
Sadly, it's the latter scenario that Brainchip investors have to contemplate today.
Looking at the past ten years of Brainchip's insider trading, there aren't too many buy transactions. In fact, the last time a director bought additional Brainchip shares on the open market was way back in July 2013. Yes, it's been almost ten years since a Brainchip insider used their own money to buy shares on the open market.
Sure, multiple directors have transferred stock or obtained additional shares by way of exercising options. But no direct buys. Not exactly confidence-inspiring stuff.
But it gets even more sobering.
How many shares have Brainchip insiders sold in ten years?
The past decade hasn't seen much buying action. But it has seen plenty of selling action.
In fact, Branchip insiders have sold around $16 million worth of Brainchip shares over the past decade.
Most of these sales occurred in 2021 and were executed by Brainchip founder and chief technology officer Peter van der Made. Van der Made unloaded more than $2.5 million worth of shares back in June 2021, with another $4.36 million sold in September of that year. An additional $3.66 million of shares were sold in October as well. Van der Made offloaded another $701,500 or so in shares in December last year, his last sell to date.
Other insiders that got rid of some of their Branchip holdings include CEO Sean Hehir. Hehir flogged off just over $700,000 worth of shares in December last year as well. Then there was director Louis DiNardo and chair Antonio Viana, who got rid of roughly $130,66 and $79,000 shares respectively that month too.
So lots of selling and not much buying from Brainchip's top lieutenants. At the end of the day, it's up to Branchip shareholders whether this activity is concerning enough to warrant a change of thesis.
After all, it's not an ethical sin for directors to want to sell some shares from time to time. Perhaps they want to diversify their wealth or make a large purchase. It's worth keeping in mind that van der Made, for example, still retains more than 156 million Brainchip shares. But $16 million to zero in terms of sells and buys is an arguably hard ledger to balance.
