Insider Trades: Joyce sells $17 million of Qantas stock, among other ASX 200 director trades

Welcome back to the Insider Trades series. 

For this instalment we’re looking at on-market director transactions valued at $10,000 or more, that have taken place between 30 May and 6 June 2023.

In the ASX large-caps space, there were 11 transactions that met the above criteria, only one of which was a sell... but what a sell it was! 

The largest single transaction was from the outgoing Qantas CEO Alan Joyce, who executed (easily) the highest-volume trade of the week and probably one of the year’s biggest.

On the buy side, we only saw moves from five individual directors of ASX 200 companies – but more than half a million dollars’ worth of Eagers Automotive stock was bought by an insider.

Top Director Trades

Qantas Airways (ASX: QAN)

Alan Joyce sold 2.5 million Qantas shares – valued at $16.9 million – on 1 June. On the same day, Qantas bought back 1.85 million shares as part of its on-market buyback.

“For him to do that – particularly while Qantas is doing a pretty aggressive on-market buyback – to me, that’s not a good look,” says Ben Clark, portfolio manager, TMS Capital. (Who, for the record, doesn’t own the stock).

Aside from Joyce selling 90% of his stock six months before he walks away from the company, there are several reasons Clark regards the stock as a “sell” currently.

“I feel like the business, over the last couple of years, has probably gone through a period where it’s been over earning. It’s always been a cyclical company and I think the cycle goes to the downside now,” Clark says.

One of the reasons he gives for this view is the strong likelihood of far more price-sensitive consumers from here on, given many have already rid themselves of the travel bug that manifested as COVID travel restrictions lifted.

Clark expects fierce pricing competition from other airlines too, particularly those in China – the main area of competition pre-COVID – which are “gearing back up.”

An outlook for a lot of capex from Qantas is another huge detractor.

“It’s been well-documented that Qantas has got one of the oldest fleets of any tier-1 airline in the world. There’s going to be a lot of capex needed over the next five to 10 years.”

Clark also expresses concern at the way the company was scooped up so quickly by many investors ahead of the reopening of global travel once COVID restrictions were eased.

“They can see in front of Qantas that it’s all systems go, so it’s probably also got some institutional investors or other shareholders in there that might not normally look at it,” he says, suggesting this might leave the stock particularly vulnerable to selloffs.

Qantas 12-month price chart (Source: Market Index)

Eagers Automotive (ASX: APE)

Featuring in this list for the second consecutive week, Nicholas Politis bought a further $514,800 worth of the global automotive retailer’s stock. Rich-lister Politis is a non-executive director of Eagers and executive chair of the company’s biggest shareholder, WFM Motors. He purchased the stock via five transactions across as many days.

Eagers Automotive 12-month price chart (Source: Market Index)