JCL Holdings, an affiliate of the estate of Walmart (WMT) heir John T. Walton, sold 1.4 million shares of First Solar (FSLR) stock earlier this month, reducing their holdings from 12.1 million to 10.7 million shares.
This insider sale may spook some investors, especially in the wake of CEO Michael Ahearn dumping half his stock since the 2006 IPO.
However, John T. Walton, a founding investor, still has skin in the game. He controls about 23 million shares, or 28%, of First Solar’s shares.
“My observation would be that, there’s only one form of insider transaction that is unambiguous, and that’s a buy, because that can mean only one thing,” said Rob Stone, an analyst at Cowen & Co., an investment bank and brokerage firm.
“I believe that the management position (in First Solar) is still substantial in so far as it would align them with shareholders,” said Stone. “And one cannot fault First Solar’s management as to the value they’ve created for shareholders.”
The bottom line is that FSLR IPO’d at $20 and is now trading at almost 14x that. That’s a heck of a return for less than 2 years time, especially considering what’s happening across the rest of the markets. The Walton family may not need the money, but you can’t blame them for taking some off the table.
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