Tag Archives: Corporations

Palantir Insiders Are Dumping The Stock. What Do They Know That You Don’t?

The lock-up that stopped insiders at Palantir Technologies from selling their shares recently expired. And boy, are they excited!

Palantir stock sank as much as 13% on Tuesday after regulatory filings showed the company’s co-founder Stephen Cohen and two other top executives offloaded 2.7 million shares.

And they’re not the only ones:

Just a month after Palantir went public last year, CEO Alex Karp and co-found Peter Thiel sold a combined 41.45 million shares, for more than $400 million.

These sales go way beyond what it would take to have financial security or fund most any lifestyle. To me, it suggests that they think the company has gone about as far as it’s going to and it’s time to cash out.

In a company destined for greatness, you would expect to see the insiders holding onto their shares. They wouldn’t want to miss out on the amazing times ahead!

But that’s not the case here. I agree with them. Palantir is overvalued with a questionable business model and should be making money by now, 18 years since its founding. But it’s never made a dime.

The picture isn’t all bleak: a certain number of insiders are buying. But seeing these huge sales by the founders and top executives would definitely give me pause.

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Photo: “PandoMonthly – April 2012 – Sarah Lacy Interviews Peter Thiel” by thekenyeung is licensed under CC BY-NC-ND 2.0

Big Loans at Almost No Interest for Sundial Insiders Are a Rip Off For Shareholders

They say the best way to rob a bank is to own one. Turns out that’s true for weed farms, too.

I came across an interesting piece of info deep in Sundial Growers’ financial statement. Two employees have taken out loans totalling $200,000 (CAD) from the company at almost no interest.

But first, if you’re not familiar, what is Sundial Growers? The Canadian cannabis company is a favorite of Reddit’s Wallstreetbets, but it’s losing a fortune and may not be around much longer (more info on that here and here).

These employees (presumably top executives, not low wage bud tenders) got these loans at between 0 and 1.5% interest. See this section of their financial report:

Good luck finding a personal loan at a bank that cheap. If a bank won’t loan these guys money at such low rates, why should the shareholder? This is a rip off for shareholders.

This is particularly egregious in a company that is losing a fortune and could be out of business soon. When employees are in danger of losing their jobs and the company is in danger of losing 100% of the shareholders’ money (the usual outcome in bankruptcy), low interest loans to insiders are particularly gross.

I’d avoid this stock like the plague. But do consider applying for a job there if you need a cheap loan! 🙂

For more about another Wallstreetbets favorite, Gamestop, check out this post.

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Photo: “Bear & Moneybags” by edenpictures is licensed under CC BY 2.0