Guess which ASX tech share is sinking after $45 million founder sell-down
A man looking at his laptop and thinking.
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.
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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.