Jamie Dimon's big JPMorgan stock sale may be a warning sign, given his stellar track record at market timing

Published Mon, Feb 26 202412:07 PM ESTUpdated Mon, Feb 26 20242:11 PM EST

JPMorgan CEO Jamie Dimon sold hundreds of thousands of shares in the bank last week, a possible worrisome signal given his strong track record at timing the market. The billionaire executive sold 821,778 shares worth about $150 million last week, according to Bespoke Investment Group. What Dimon sold was all profit from the more than one million shares he bought between 2009 and 2016, Bespoke said. Dimon has bought before upturns in the past. Now, his decision to sell could mean bad news for JPMorgan shareholders, given what has often proven correct timing when the market is on edge. Every time Dimon has bought more than 1,000 shares since 2009, he has profited. The 500,000 shares he snapped up in 2009 during the Global Financial Crisis have since soared nearly 700%. A purchase of more than 200,000 shares in 2012 have subsequently returned more than 430%, while another acquisition of 500,000 shares in early 2016 has since run up more than 240%. In total, Dimon bought more than 1.2 million shares between 2009 and 2016. On average, each one of those holdings have gained about 389% in the time he has held them. Investors typically see insider purchases as signs of confidence in future performance. Sales can be viewed as an indicator of trouble ahead, or sometimes simply be tied to wealth planning, diversification or estate management. Insider buys and sells alone may not signal where shares will go next. In fact, the average analyst polled by FactSet has a buy rating on JPMorgan and an average price target implying potential upside of 5% in the country's biggest bank stock. JPMorgan shares are up more than 8% so far in 2024, outperforming the S & P 500 's less than 7% gain as well as a more than 4% decline in the SPDR S & P Bank ETF (KBE) . JPM KBE,.SPX YTD mountain JPMorgan vs. the S & P 500 and SPDR S & P Bank ETF, year to date Dimon's plans to sell shares have raised concern that the 67-year-old chief executive is considering retirement. He has never before dumped shares of the bank other than for technical reasons, such as taking advantage of option grants. A filing from JPMorgan last October said Dimon would sell one million shares sometime in 2024 but didn't specify when. On Monday, Dimon told CNBC during the JPMorgan High Yield and Leveraged Finance Conference that the market likely hasn't adequately priced a scenario in which interest rates stay higher for longer. He also disagreed with the high probability penciled in of a recession being avoided. "The market is kind of pricing in a soft landing. That may very well happen," Dimon told CNBC's Leslie Picker at the Miami conference. "But the [market's] odds are 70 to 80 percent. I'll give you half that, that's all." — CNBC's Jeff Cox contributed to this report.