Some S&P/ASX 200 Index (ASX: XJO) tech stock investors may be a little concerned about what has been going on with their companies following some insider share sales.
When leadership figures buy shares, the market normally views it as a good thing because it suggests management believes the valuation is attractive.
However, it can be a worrying sign when there's a share sale. Do management think the share price is overvalued? Is a bad update coming soon? Is this insider less committed to the business than before?
Let's have a look at what sales happened relating to these ASX 200 tech stocks.
Netwealth Group Ltd (ASX: NWL)
Netwealth's Michael Heine and Matthew Heine both own Netwealth shares indirectly.
Matthew Heine was indirectly involved in three different sales, with two on 11 October 2024 and one on 14 October 2024.
Those three transactions included the sale of 1.1 million Netwealth shares, 510,671 shares and 47,790 shares. These transactions raised $29.7 million, $14 million and $1.3 million – this came to a total of $45 million. Despite the sale, Matthew Heine still has exposure to more than $3.3 billion of Netwealth shares – he's still heavily financially involved in the business alongside regular investors.
It's worth noting that Michael Heine was also indirectly involved in the sale of 1.1 million Netwealth shares for $29.7 million on 11 October 2024. However, he still has exposure to over $2.8 billion worth of Netwealth shares.
These sales come after a very strong run of the Netwealth share price, which has increased by over 80% in 2024 to date, as shown on the chart below.
Last week, the business reported a strong quarterly update for the three months to 30 September 2024. It showed funds under administration (FUA) at September 2024 were $95.4 billion, with an increase of $7.4 billion in the three months to September, including FUA net inflows of $4 billion.
Funds under management (FUM) at 30 September 2024 were $22.5 billion, an increase of $2 billion for the quarter. FUM net inflows for the ASX 200 tech stock in the three months to September were $1.4 billion.
Nextdc Ltd (ASX: NXT)
Craig Scroggie is the current CEO and managing director of Nextdc shares. He has both direct and indirect ownership of the ASX 200 tech stock.
On 10 October 2024, Scroggie sold 850,087 Nextdc shares at a price of $17.74 per share, for a total value of $15 million.
Of those Nextdc shares sold, Scroggie held 7,180, and 842,907 were converted from performance rights allocated under Nextdc's long term incentive program.
Despite the significant sale, Scroggie still owns 435,511 ordinary Nextdc shares held by a related entity, as well as 458,616 performance rights, so he still has a lot of financial exposure to the data centre business.
This sale came after the business carried out a capital raising to fund its plans for further Asian expansion in places like Thailand and Malaysia.
While these ASX 200 tech stocks have seen some large sales, the leadership figures are still heavily invested in the business.
