Nvidia and Palantir’s Insiders Are Selling, Should Wall Street Be Worried?

AI-related stocks have delivered explosive gains for the past two and a half years. Nvidia (NASDAQ:NVDA) turned its GPUs into the picks and shovels of the new gold rush and became the planet’s most valuable company. Palantir (NASDAQ:PLTR) has not only defied gravity, but it is also accelerating with off-the-charts execution.

That said, there has been a trend in recent weeks of insiders and management selling large amounts of shares of both PLTR and NVDA. The most recent wave came in June, when Nvidia insiders alone cashed in more than $1 billion of shares in twelve months, including a flurry of $500 million in sales in just the last month as the stock reached fresh all-time highs.

Palantir’s directors and officers have filed sale after sale, with CEO Alex Karp’s offloading the most.

Let’s take a look at whether or not it’s worth worrying about.

Nvidia (NVDA)

Nvidia has been the linchpin of the AI industry, and that’s unlikely to change anytime soon. Some insiders have decided to sell some of their shares instead of holding on.

There has been an uptick in insider selling in recent months. The month of May saw 11 insider sales, followed by 9 insider sales in June. May’s insider sales were the highest since July 2024.

In the past three months, insiders have bought 21,588 shares of NVDA, compared to 6,135,274 shares sold.

Should you worry about it? Probably not.

The thin insider buying volume is routine here, and Nvidia’s insiders have rarely bought the stock. Moreover, the insider selling activity consists mostly of pre-planned sales by management to fund personal expenses. You will see eyebrow-raising amounts being mentioned, but that’s a drop in the bucket compared to Nvidia’s valuation.

NVDA’s price has ballooned, so it’s an expected correlating increase in how much insiders are offloading in dollars.

If you try to chart the price with the insider sales, it does get interesting.

There is a slight correlation between insider sales and a plateau, though I would lean more towards this being a coincidence.

The fundamentals remain stellar, and the current rally could take it well above $200 if Nvidia trades at the premium it did last near. China H20 exemptions will also boost it more.

Analysts have been raising their price targets to $200 or above this week. Jefferies, BofA, and Needham, to name a few.

Palantir (PLTR)

There’s been a bit more action here in the past few months. Palantir’s CEO and co-founder have both sold substantial amounts of PLTR stock in the past few months. Karp sold $50 million in Palantir shares in just May, whereas co-founder Stephen Cohen sold shares worth hundreds of millions.

Stephen Cohen’s sale may raise some eyebrows, but that’s not really a sell signal. Here’s why. Pay attention to the column all the way to the right.

As such, I wouldn’t worry about Palantir simply due to these insider sales. The amount being sold by management remains small compared to the broader rally.

PLTR stock has recently broken through $150 with little resistance, and Wall Street could push it even higher due to the focus shifting to its cash flow instead of its earnings.

Value Palantir on cash flow, and things look a bit better. For example, NVDA stock trades at 58 times trailing twelve-month free cash flow and a bit over 55 times earnings. PLTR stock trades at 666 times earnings, but PLTR stock trades at around 290 times TTM FCF. That’s still a Dot Com-level premium, but this bull market can take it much higher due to Palantir consistently beating and raising each quarter.

The upper end of full-year 2025 FCF guidance is at $1.8 billion, so that’s a 200 times forward FCF premium. Analysts expect FCF at $2.2 billion in 2026, or 164 times the current price.

These numbers still price Palantir richly, but it’s understandable why bulls planning to hold for the long run believe it’s worthwhile.