Guess which ASX tech share is sinking after $45 million founder sell-down

This company's founders just sold millions worth of stock.

| More on:
A man looking at his laptop and thinking.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

It's been a rough start to the trading week for ASX shares so far this Monday. At the time of writing, the S&P/ASX 200 Index (ASX: XJO) has slumped by 0.35% and is back down to around 7,740 points. But let's talk about one ASX tech share that is getting even more severely punished today.

That ASX tech share is none other than WiseTech Global Ltd (ASX: WTC). This logistics company closed at $100.30 a share last week. But this morning, those same shares opened at $98.54. They have since dropped a hefty 4.33% to $96.07 each.

It's a hefty drop for this former WAAAX star. Wisetech shares have had a stellar showing over 2024 to date. Even after today's plunge, the Wisetech share price remains up a sturdy 26% or so over 2024 to date. The company has also risen by 23.9% over the past 12 months.

But what's going on this Monday that has elicited this awful drop?

Well, it looks as though a new ASX filing that was released last Friday after market close may be responsible.

This ASX filing revealed that Wisetech co-founders Richard White and Marie Isaacs have offloaded a significant chunk of this ASX tech share.

Should ASX tech share investors be worried about this massive founder sell-off?

Yep, the form reveals that White and Isaacs, through a holding company RealWise Holdings Pty Ltd, sold 478,415 shares of Wisetech between 21 June and 28 June in a series of on-market trades. Realwise received an average sell price of $95.19 per share for these sales, meaning that the holding company has bagged a whopping $45.54 million for these efforts.

Wisetech CEO Richard White owns 91.83% of RealWise Holdings, while Isaacs owns the remaining 8.17%. This means that White has benefitted to the tune of $41.82 million from these sales, while Isaacs has bagged $3.72 million.

So should investors be worried about this Wisetech founder sell-off?

Well, that's up to them. No investor likes to see the management team of their companies sell down their stakes in the business they are being handsomely paid to manage. After all, it decreases any financial alignment that management has with shareholders.

But founders, CEOs and members of a company's management have their own financial obligations to tend to. Perhaps they have a large tax bill to pay or a new house they want to buy. Perhaps they just want to diversify their wealth away from one single investment.

Even after these significant sales, White and Isaacs retain massive stakes in Wisetech. White still indirectly owns 117,837,565 shares of this ASX tech share, valued at $11.32 billion at today's prices. So this sale is something of a drop in the ocean for him.

Meanwhile, Isaacs retains 10,479,200 shares, worth just over $1 billion.

So again, it's up to Wisetech investors to decide if they approve or disapprove of White and Isaacs' recent moves regarding this ASX tech share. But judging by today's share price sell-off, it has put at least some investors offside.

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended WiseTech Global. The Motley Fool Australia has positions in and has recommended WiseTech Global. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Technology Shares

A young woman sits with her hand to her chin staring off to the side thinking about her investments.
Technology Shares

What will it take for DroneShield shares to enter the ASX 200?

DroneShield shares are up 710% in a year. So why aren't they in the ASX 200 yet?

Read more »

defence, military soldier standing with army land vehicle as helicopter flies overhead
Share Market News

'Geopolitical risk is unlikely to subside': Should you pile into ASX defence shares right now?

With gains of up to 740% in a year, can ASX defence shares keep charging higher?

Read more »

A man sits thoughtfully on the couch with a laptop on his lap.
Technology Shares

ASX NASDAQ (NDQ) ETF: Up 30% in a year, should you buy now or wait?

Tech continues to dominate in 2024. Will this continue?

Read more »

A silhouette shot of a man holding a control in his hands and watching as a drone hovers overhead with sunrays coming from the sky.
Technology Shares

DroneShield share price roars to yet another all-time high in 2024 surge

Investors continue lifting the bid on the counter-drone tech company.

Read more »

A woman holds her hand out under a graphic hologram image of a human brain with brightly lit segments and section points.
AI Stocks

Here's the outlook for 3 ASX artificial intelligence (AI) shares in FY25

Could it be another bumper year?

Read more »

A man is shocked about the explosion happening out of his brain.
Technology Shares

BrainChip shares struggle in FY24 – what's ahead for FY25?

The road ahead is foggy for the AI player.

Read more »

A woman screams and holds her hands up in frustration.
Technology Shares

Why is the RPM Global share price crashing 22% today?

This tech stock is having a tough session. But why?

Read more »

two computer geeks sit across from each other with their laptop computers touching as they look confused and confounded by what they are seeing on their screens.
Technology Shares

Can ASX 200 tech shares produce another strong performance in FY25?

Is the tech sector capable of beating the overall ASX share market in the next 12 months?

Read more »