Jeff Bezos, Founder and Chairman, has been cashing in part of his Amazon stock fortune, selling $10 billion throughout 2021. Despite this wave of selling, Bezos still holds nearly 10% of the shares outstanding, with a current value of ~$175 billion. The other largest shareholders are Vanguard at 6.5%, BlackRock at 5.5%, and Bezos’ ex-wife, Scott MacKenzie, at 3.9%.

Should you be worried?

Heavy selling by executives is commonly seen as a sign that the stock may have reached its potential. A further argument for this view is that the Amazon stock price has hit record levels this year and the price increase has been at a slower rate than in past years. The stock is currently up a modest ~8% year-to-date. Some could argue that it might be time to take some profit on Amazon trades.

Wall Street support

As shown in our weekly Analyst Recommendations data, there is still a strong view that Amazon stock will continue to outperform. A Bloomberg survey of equity research analysts indicates that 98% of analysts currently have a “BUY” rating on Amazon, whilst only 2% have a “HOLD” rating, and no analysts have a “SELL” rating. Amazon remains the top rated “US Megacap” stock and analysts expect the company to benefit from another strong holiday season in their e-commerce revenue stream.

Tax-related selling

A reason for Bezos’ stock sales could also be tax-related and part of a wider movement recently of executive sales in anticipation of higher tax rates being proposed and implemented in the near future by the Democratic government.  

AlphaPicks owns shares in Amazon. To buy shares in Amazon, register here with our preferred partner, EToro.

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