In this article, we discuss 10 stocks that US senators are selling. If you want to see more stocks that were recently sold by US senators, click 5 Stocks US Senators Are Selling.
Investors often seek to replicate the returns of House members and senators, since it is usually assumed that politicians are privy to information that is not generally disclosed to the public. To avoid insider trading and promote transparency in transactions, the STOCK Act of 2012 was introduced. As per the act, politicians are required to publicly disclose their personal trading activity, in addition to the transactions made by their spouses and dependent children within 45 days.
On the other hand, there are multiple debates that suggest that politicians should be banned from trading altogether. Many Americans believe politicians to be bypassing the STOCK Act conveniently and using insider knowledge to benefit financially. Some Congress and senate members agree with this stance, and believe that politicians should be disallowed to trade when in office. Some politicians dumped several stocks right before the COVID-19 pandemic was featured in mainstream news channels and the stock market collapsed, further strengthening this debate. Senator Elizabeth Warren has been arguing against politicians trading for years now.
Some of the most notable stocks that politicians recently dumped included Lockheed Martin Corporation (NYSE:LMT), Apple Inc. (NASDAQ:AAPL), and Meta Platforms, Inc. (NASDAQ:FB), in addition to the ones discussed in detail below.
Our Methodology
The companies listed below were picked from the Periodic Transaction Report(s) that US politicians are obliged to file. It is important to clarify that the companies listed below were picked from the public record of investments that US politicians and their families have made in the last few weeks. The purchases may not have been made by the politicians themselves but only disclosed on behalf of their family. We selected some of the stocks that US senators have sold in 2022.
Data from 900+ elite hedge funds tracked by Insider Monkey in Q4 2021 was used to identify the number of hedge funds that hold stakes in each firm.
Stocks US Senators Are Selling
10. Unilever PLC (NYSE:UL)
Number of Hedge Fund Holders: 23
Unilever PLC (NYSE:UL) is a London-based fast moving consumer goods corporation. Susan Collins, a senior United States senator from Maine, sold her Unilever PLC (NYSE:UL) shares valued at between $15,000 and $50,000 on January 21. The trade was publicly disclosed 27 days later on February 17.
On March 14, Bernstein analyst Bruno Monteyne upgraded Unilever PLC (NYSE:UL) to Market Perform from Underperform with a price target of 3,300 GBp, down from 3,500 GBp. The analyst cited valuation for the upgrade after the recent pullback in shares.
Unilever PLC (NYSE:UL) declared on February 23 a $0.482 per share quarterly dividend, a 2.2% decrease from its prior dividend of $0.493. The dividend was distributed on March 22, to shareholders of the company as of February 25.
According to its 2021 financial disclosures, Unilever PLC (NYSE:UL)’s full-year revenue stood at $59.6 billion, compared to a revenue of approximately $62 billion in 2020. Net income for the year was $6.88 billion, a marginal improvement from $6.81 billion in the prior year. The cash and cash equivalents at the end of 2021 decreased to $3.8 billion from $6.7 billion in the last year.
According to Insider Monkey’s Q4 database, 23 hedge funds held stakes worth $1.78 billion in Unilever PLC (NYSE:UL), compared to 17 funds in the previous quarter, owning stakes in Unilever PLC (NYSE:UL) valued at $876.6 million. Tom Russo’s Gardner Russo & Gardner is the biggest shareholder of the company, with 8.50 million shares worth over $457 million.
In addition to Lockheed Martin Corporation (NYSE:LMT), Apple Inc. (NASDAQ:AAPL), and Meta Platforms, Inc. (NASDAQ:FB), US politicians are dumping Unilever PLC (NYSE:UL) in 2022.
Here is what Fundsmith Equity Fund has to say about Unilever PLC (NYSE:UL) in its Q4 2021 investor letter:
“Unilever PLC (NYSE:UL) seems to be laboring under the weight of a management which is obsessed with publicly displaying sustainability credentials at the expense of focusing on the fundamentals of the business. The most obvious manifestation of this is the public spat it has become embroiled in over the refusal to supply Ben & Jerry’s ice cream in the West Bank. However, we think there are far more ludicrous examples which illustrate the problem. A company which feels it has to define the purpose of Hellmann’s mayonnaise has in our view clearly lost the plot. The Hellmann’s brand has existed since 1913 so we would guess that by now consumers have figured out its purpose (spoiler alert — salads and sandwiches). Although Unilever had by far the worst performance of our consumer staples stocks during the pandemic, we continue to hold the shares because we think that its strong brands and distribution will triumph in the end.”
9. Occidental Petroleum Corporation (NYSE:OXY)
Number of Hedge Fund Holders: 58
Headquartered in Houston, Texas, Occidental Petroleum Corporation (NYSE:OXY) acquires and manages oil and gas properties in the United States, the Middle East, Africa, and Latin America. The company markets and distributes oil, condensate, natural gas liquids, natural gas, carbon dioxide, petrochemicals, and power.
Thomas Tuberville is one of the most active traders in the US Senate. Since the beginning of 2021, Tuberville has been serving as a junior United States senator from Alabama. According to disclosures published on March 12, the senator sold shares of Occidental Petroleum Corporation (NYSE:OXY) valued at between $50,000 and $100,000 on February 22. The trade was declared publicly 17 days after it was initiated.
On April 7, Piper Sandler analyst Ryan Todd upgraded Occidental Petroleum Corporation (NYSE:OXY) to Overweight from Neutral, raising the price target to $88 from $44. According to the analyst, Occidental Petroleum Corporation (NYSE:OXY) shares are “relatively inexpensive” despite its year-to-date performance, given the company has the greatest leverage in the sector to rising oil prices.
Occidental Petroleum Corporation (NYSE:OXY) on February 24 declared a $0.13 per share quarterly dividend, a 1200% increase from its earlier dividend of $0.01. The dividend will be paid on April 15, to shareholders of record on March 10.
Among the hedge funds tracked by Insider Monkey in Q4 2021, Carl Icahn’s Icahn Capital LP is the biggest shareholder of Occidental Petroleum Corporation (NYSE:OXY), with 45 million shares worth $1.30 billion. Overall, 58 hedge funds were bullish on the stock at the end of December 2021, compared to 60 funds in the third quarter.
Here is what Smead Capital Management has to say about Occidental Petroleum Corporation (NYSE:OXY) in its Q3 2021 investor letter:
“Oil stocks dominated our winners for the quarter. We showed that we have unlimited ability to tempt fate by buying into Occidental Petroleum (OXY) this year after it was our biggest loser of 2020. It gained 16.64% during the third quarter.”
8. Apple Inc. (NASDAQ:AAPL)
Number of Hedge Fund Holders: 134
Ronald Wyden has been serving as a senior United States senator from Oregon since 1996. Wyden sold shares of Apple Inc. (NASDAQ:AAPL) on February 24. The transaction was worth somewhere between $50,000 and $100,000 and it was disclosed 27 days later on March 24.
For 2021, Apple Inc. (NASDAQ:AAPL)’s full-year revenue stood at $365.8 billion, up from a revenue of $274.5 billion in 2020. Similarly, net income in 2021 increased to $94.6 billion from $57.4 billion in the previous year. However, the company’s cash and short term investments decreased from approximately $100 million in 2020 to $62.6 million in 2021.
On April 7, JPMorgan analyst Samik Chatterjee stated that he has a cautious view on the consumer spending outlook, which limits his growth forecasts for the smartphone space. This limits the expected upside from Apple Inc. (NASDAQ:AAPL)’s new product launches and App Store revenue as well. However, the analyst stated that the new estimates for high-end smart smartphones, tablets, and laptops are “fairly modest given the resilience” of demand. He maintained an Overweight rating on Apple Inc. (NASDAQ:AAPL) with a $210 price target.
According to Insider Monkey’s data, hedge fund sentiment around Apple Inc. (NASDAQ:AAPL) was largely bullish. In Q4 2021, 134 funds held long positions in Apple Inc. (NASDAQ:AAPL), compared to 120 funds in the last quarter. The total stakes owned in Q4 amounted to $186 billion. Warren Buffett’s Berkshire Hathaway is the biggest position holder in Apple Inc. (NASDAQ:AAPL), with more than 887 million shares worth $157.5 billion.
Here is what Berkshire Hathaway has to say about Apple Inc. (NASDAQ:AAPL) in its Q4 2021 investor letter:
“Apple Inc. (NASDAQ:AAPL) – our runner-up Giant as measured by its year end market value – is a different sort of holding. Here, our ownership is a mere 5.55%, up from 5.39% a year earlier. That increase sounds like small potatoes. But consider that each 0.1% of Apple’s 2021 earnings amounted to $100 million. We spent no Berkshire funds to gain our accretion. Apple’s repurchases did the job. It’s important to understand that only dividends from Apple are counted in the GAAP earnings Berkshire reports – and last year, Apple paid us $785 million of those. Yet our “share” of Apple’s earnings amounted to a staggering $5.6 billion. Much of what the company retained was used to repurchase Apple shares, an act we applaud. Tim Cook, Apple’s brilliant CEO, quite properly regards users of Apple products as his first love, but all of his other constituencies benefit from Tim’s managerial touch as well.”
7. Ford Motor Company (NYSE:F)
Number of Hedge Fund Holders: 53
Ford Motor Company (NYSE:F) was incorporated in 1903 and is based in Dearborn, Michigan. The automaker has a product portfolio consisting of trucks, cars, sport utility vehicles, electric vehicles, and luxury vehicles. Thomas Tuberville, a junior US senator from Alabama, sold shares of Ford Motor Company (NYSE:F) valued at between $15,000 and $50,000. The sale took place on February 1 and was disclosed on March 12.
Barclays analyst Brian Johnson downgraded Ford Motor Company (NYSE:F) on April 7 to Equal Weight from Overweight, slashing the price target from $23 to $17. Despite the selloff, investors are still underestimating risks in the automobile sector, ranging from inflation and production pressures to interest rate hikes, the analyst told investors. He downgraded the sector to Negative, and cited “soft execution” and the sector concerns for downgrading Ford Motor Company (NYSE:F).
On April 4, Ford Motor Company (NYSE:F) reported that its US sales declined by 25.6% in March. In its financial results for the fourth quarter of 2021, the company posted earnings per share $0.26, missing estimates by $0.15. The $35.26 billion revenue also missed market consensus estimates by more than $365 million.
According to the Q4 database of Insider Monkey, 53 elite hedge funds were bullish on Ford Motor Company (NYSE:F), compared to 51 funds in the prior quarter. D E Shaw owned the largest stake in the company, with 28.4 million shares worth $590 million.
Elite hedge funds continue to favor Ford Motor Company (NYSE:F), just like Lockheed Martin Corporation (NYSE:LMT), Apple Inc. (NASDAQ:AAPL), and Meta Platforms, Inc. (NASDAQ:FB).
In its Q1 2020 investor letter, Greenlight Capital Fund highlighted a few stocks and Ford Motor Company (NYSE:F) was one of them. Here is what the fund said:
“General Motors (GM) was a disappointment. The damage from last year’s strike consumed most of the cash flow GM would have otherwise generated in 2019. We had expected a strong bounce back in earnings and cash flow in 2020, but the annual guidance, while meeting Wall Street expectations, was worse than we expected. Further, the cash burned during the strike needed to be re-earned in order to protect GM’s investment grade rating. Pre-crisis, there would have been, at best, a minimal share repurchase late in the year. At the analyst day, our hopes that 2020 would finally be the year were dashed. We sold our stock. Over our five-year holding period, we made a 9.6% IRR on GM. In the difficult environment, its most comparable peer, Ford Motor Company (NYSE:F), lost about half its value.”
6. Microsoft Corporation (NASDAQ:MSFT)
Number of Hedge Fund Holders: 262
Since 2015, Shelley Capito has been serving as a junior United States senator for West Virginia. On February 24, she sold Microsoft Corporation (NASDAQ:MSFT) shares valued at between $1,000 and $15,000. The transaction was disclosed on March 12.
A group of four senators, including Elizabeth Warren, Bernie Sanders, Cory Booker, and Sheldon Whitehouse, urged the Federal Trade Commission on March 31 to calibrate Microsoft Corporation (NASDAQ:MSFT)’s approximately $69 billion acquisition of Activision Blizzard, Inc. (NASDAQ:ATVI). They cited their concerns over the increasing monopolistic powers in the tech industry and mistreatment of employees working for Activision.
On March 16, Jefferies analyst Brent Thill reiterated a Buy rating and a $400 price target on Microsoft Corporation (NASDAQ:MSFT) shares. He stated that the company’s emerging Power Platform is one of its biggest assets, which addresses the low-code market that has the potential for over 1 billion users. According to the analyst, Power Platform “could be greater than Office” and act as a growth catalyst for the tech giant.
Hedge fund sentiment around Microsoft Corporation (NASDAQ:MSFT) was extremely bullish in the fourth quarter of 2021. A total of 262 hedge funds placed long calls on Microsoft Corporation (NASDAQ:MSFT), compared to 250 funds in the prior quarter. Ken Fisher’s Fisher Asset Management is the largest stakeholder of the company, with roughly 27 million shares worth $9 billion.
Here is what Baron Opportunity Fund has to say about Microsoft Corporation (NASDAQ:MSFT) in its Q4 2021 investor letter:
“Shares of Microsoft Corporation, a cloud-software leader and provider of software productivity tools and infrastructure, rose during the quarter, following a strong earnings report highlighting solid demand for its broad product stack and continued momentum migrating its business to the cloud. Microsoft’s results continued to be strong across the board, with total revenue growing 20% in constant currency, beating Street estimates by 3%; an acceleration in Commercial Cloud revenue to 34% constant-currency growth; operating margins expanding to just under 45%; earnings growth of 23%; and free cash flow growth of 30%. We believe the company is positioned to deliver 13% to 15% organic growth over the next three years, underpinned by total addressable market expansion and continued market share gains across its disruptive cloud product portfolio.”
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Disclosure: None. 10 Stocks US Senators Are Selling is originally published on Insider Monkey.
