In this article, we will take a detailed look at the 10 Stocks American Politicians are Buying in 2024. For a quick overview of such stocks, read our article 5 Stocks American Politicians are Buying in 2024.
American politicians using their insider knowledge and influence to make money off the stock market has piqued the curiosity of researchers and average investors for decades. Despite huge controversies and calls for an increased scrutiny and a ban on stock trading for politicians, American senators and Congress members continue to trade stocks. A report by Unusual Whales talked in detail about the performance of American politicians’ stock picks in 2023. The report said that of the 100 Congress members trading stocks last year, 33% beat the S&P 500.
Which Stocks American Congress Members Like?
The report also showed that the most popular stocks among American politicians last year were from healthcare, financials and technology industries. The portfolios of Democrats performed better than those of Republicans since the latter group was heavy on financials, oil, and commodities, while Democrats benefited from their investments in technology companies.
Congress Stock Picks Performance and Returns: An Independent Analysis
It’s not only the mainstream financial publications and news outlets that closely watch American politicians’ stock trades. Investing enthusiasts equipped with data analysis skills also take a huge interest in analyzing the benefits of following Congress stock trades over the long term. For example, three years ago, someone on Reddit analyzed data available on a website called Senate Stock Watcher and processed over 9,000 stock trades initiated by the members of US Congress to see how these stocks perform. This Redditor crunched numbers and found returns of stocks for a month, a quarter and since 2019 through the date of their analysis. The idea was to see how Congress stock picks performed in the short term and long term. Results shows that Congress members are long-term investors since their stock picks beat the S&P 500 by about 6%. However, even for short-term time windows, Congress members’ stock picks beat the market albeit with narrow margins.
While the STOCK act signed into law by former President Barack Obama significantly limited insider trading by Congress members, data shows that US politicians and insiders sprang back into action when the COVID-19 pandemic hit. A research showed that between February and early April of 2020, 12 senators made 227 stock purchases worth about $98 million, while 37 House members did 1,358 trades worth as much as $60 million.
A Wall Street Journal’s analysis shows that about 240 officials of health agencies that won federal contracts related to the pandemic had owned shares of biotech and drug companies worth between $9 million to $28 billion.
Performance of Republicans and Democrats in Stock Trading
Investors who are interested in tracking American politicians’ stock picks and their performance can use Unusual Whales Subversive Republican Trading ETF (BATS:KRUZ) and Unusual Whales Democratic ETF (BATS:NANC). Both ETFs were launched in early 2023. NANC invests in stocks purchased or sold by Democratic members of Congress and their spouses, while KRUZ invests in stocks traded by Republicans. So far in 2024, KRUZ is up 4.14%, while the ETF has returned about 17% in the past one year. Democrats performed well in both these time periods since the NANC ETF gained 6.3% year to date and 27% over the past one year.
Methodology
For this article we used publicly available disclosures and SEC filings of American politicians and picked 10 stocks that were bought by American senators and Congress members over the past few weeks. Some top names in the list include Advanced Micro Devices, Inc. (NASDAQ:AMD), Johnson & Johnson (NYSE:JNJ) and Devon Energy Corp (NYSE:DVN). With each stock we have also mentioned the number of hedge fund investors. Why do we pay attention to what insiders are doing? Insider Monkey’s monthly newsletter and portfolio that focuses on activist hedge funds, insider trading and stock picks from hedge fund investor newsletters and conferences returned 199.2% between March 2017 and March 12, 2024 and outperformed the S&P 500 ETFs’ 144.9% gain by more than 54 percentage points.
10. Dassault Systemes SE (OTC:DASTY)
Number of Hedge Fund Investors: N/A
French software company Dassault Systemes SE (OTC:DASTY) is one of the stocks American Congressmen are piling into in 2024. Congressman Josh Gottheimer from New Jersey bought shares worth between $1,001 – $15,000 in Dassault Systemes SE (OTC:DASTY) on March 13. Since then the stock is down 11%.
9. Humacyte Inc (NASDAQ:HUMA)
Number of Hedge Fund Investors: 12
Biotechnology company Humacyte Inc (NASDAQ:HUMA) is one of the stocks American politicians are buying. Tommy Tuberville, a senator from Alabama, bought Humacyte Inc (NASDAQ:HUMA) shares worth somewhere between $1,000 to $15,000 on March 21. Since then through April 17, the stock is down about 15%.
Insider Monkey’s database of 933 hedge funds shows that 12 funds reported owning stakes in Humacyte Inc (NASDAQ:HUMA) as of the end of 2023.
During the company’s Q4 earnings call, Humacyte’s management talked in detail about business updates:
“We had cash and cash equivalents of $80.4 million as of December 31, 2023. We also completed two transactions in early 2024, which added substantially to our cash balances. On March 5, 2024, we closed an underwritten public offering of common stock and raised net proceeds of approximately $43.1 million. In addition, on March 11, 2024, we’ve received $20 million in proceeds from an additional draw under our revenue purchase agreement with Oberland Capital. Total net cash used was $69.0 million for the year ended December 31, 2023, compared to $67.7 million for the year ended December 31, 2022. We believe that our cash and cash equivalents are adequate to finance operations well past the currently anticipated timelines for FDA approval and commercialization of the HAV in the vascular trauma indication.
There was no revenue for the fourth quarters of 2023 and 2022, and there were no revenue for the year ended December 31, 2023. Revenue was $1.6 million for the year ended December 31, 2022, and was related to a grant supporting the development of the HAV that was completed during 2022. Research and development expenses were $20.2 million for the fourth quarter of 2023 compared to $15 million for the fourth quarter of 2022, and were $76.6 million for the year ended December 31, 2023 compared to $63.3 million for the year ended December 31, 2022. The 2023 increases resulted primarily from increased personnel, external services expenses and materials expenses supporting the expanded research and development initiatives in our clinical studies, including the completion of our V005 Phase II/III trial, NRB017-Ukraine humanitarian trial for use of HAV and extremity vascular trauma as well as our BLA filing in December and the clinical development of the HAV for use in dialysis access.”
Read the entire earnings call transcript here.
In addition to Humacyte, insiders are also buying Advanced Micro Devices, Inc. (NASDAQ:AMD), Johnson & Johnson (NYSE:JNJ) and Devon Energy Corp (NYSE:DVN).
8. Ardmore Shipping Corp (NYSE:ASC)
Number of Hedge Fund Investors: 16
Seaborne transportation company Ardmore Shipping Corp (NYSE:ASC) is one of the stocks American Congress members are piling into. Congresswoman Virginia Foxx from North Carolina on March 4 bought Ardmore Shipping Corp (NYSE:ASC) shares in a transaction worth between $1,000 and $15,000. Since March 4 through April 17 Ardmore shares have gained about 2.2%.
Of the 933 hedge funds tracked by Insider Monkey, 16 hedge funds reported having stakes in Ardmore Shipping Corp (NYSE:ASC). The biggest hedge fund stakeholder of Ardmore Shipping Corp (NYSE:ASC) was Chuck Royce’s Royce & Associates which owns an $11 million stake in Ardmore Shipping Corp (NYSE:ASC).
In addition to ASC, American politicians are also piling into Advanced Micro Devices, Inc. (NASDAQ:AMD), Johnson & Johnson (NYSE:JNJ) and Devon Energy Corp (NYSE:DVN).
7. Dominion Energy Inc (NYSE:D)
Number of Hedge Fund Investors: 26
Thomas Richard Carper, an American Senator from Delaware, bought Dominion Energy Inc (NYSE:D) shares worth between $1,001 – $15,000 on March 28. Since then through April 17, Dominion Energy Inc (NYSE:D) stock has declined by about 4%.
Out of the 933 hedge funds tracked by Insider Monkey, 26 hedge funds had stakes in Dominion Energy Inc (NYSE:D). The biggest stakeholder of Dominion Energy Inc (NYSE:D) during this period was Ric Dillon’s Diamond Hill Capital which owns a stake worth about $185 million in Dominion Energy Inc (NYSE:D).
In February, during an earnings call, the company talked about guidance and important business updates:
“We’ve provided a reconciliation of actual operating earnings relative to the guidance we provided on the last earnings call. There were 3 key drivers for the variance to guidance. First, during the fourth quarter, we experienced $0.02 of worse-than-normal weather in our utility service territories. Second, we incurred $0.03 of hurt related to certain outages at Millstone.
Third, as part of the business review and after we had given earnings guidance in November, we elected to change our accounting methodology for the way we recognize investment tax credits and earnings. This resulted in a $0.02 quarterly and $0.07 annual negative variance to guidance. I’ll expand more on this accounting methodology change in a moment. A summary of all drivers for earnings relative to the prior year period is included in Schedule 4 of the earnings release kit. As we mentioned on our last earnings call, we view 2023 as a transition year for the company due to the pending results of actions we’ve taken as part of the business review to support our long-term objectives. With that in mind, let me refresh our housekeeping around 2023 results.
In 2023, our operating earnings per share were $1.99. Similar to last quarter, we believe it warrants highlighting many of the same adjustments that investors may consider to more accurately assess 2023 results. First, we experienced historically mild weather during 2023, representing $0.18 of full year earnings headwinds, including $0.02 in the fourth quarter. Recall that the second quarter was the mildest quarter relative to 15-year normal in the last 50 years. We don’t expect weather to deviate from historical normal in this manner going forward. Second, we continue to expect approximately $0.50 of annualized interest savings from parent-level debt repayment, driven by the sales of Cove Point and the gas utilities. Remember, the way discontinued operations is reflected in our 2023 results, 100% of the earnings from these assets are removed but the benefit from use of sale proceeds is not captured.”
Read the full earnings call transcript here.
6. IBM Common Stock (NYSE:IBM)
Number of Hedge Fund Investors: 50
IBM Common Stock (NYSE:IBM) ranks sixth in our list of the stocks American politicians are buying in 2024. Lloyd Doggett, the Congressman from the Democratic Party, bought IBM Common Stock (NYSE:IBM) shares on March 11 in a transaction worth 1,001 and $15,000. Since then the stock has declined about 4.3%.
Insider Monkey’s database of 933 hedge funds shows that 50 hedge funds reported having stakes in IBM Common Stock (NYSE:IBM).
Diamond Hill Long-Short Fund stated the following regarding International Business Machines Corporation (NYSE:IBM) in its fourth quarter 2023 investor letter:
“Other bottom contributors included our short positions in Garmin and International Business Machines Corporation (NYSE:IBM), as well as our long position in Chevron. IBM’s software and consulting businesses were solid in the quarter, helping drive revenue growth. But the company faces numerous fundamental headwinds in both these businesses, and we expect it will struggle to meet cash-flow guidance.”
Click to continue reading and see 5 Stocks American Politicians are Buying in 2024.
Suggested Articles:
- 10 Very High Yield Dividend Stocks Billionaires Are Piling Into
- Latest Insider Selling in April 2024: 10 Stocks to Watch
- Insiders Are Buying These 11 Penny Stocks,
Disclosure. None. 10 Stocks American Politicians are Buying in 2024 was initially published on Insider Monkey.
