The first quarter of 2024 will soon end, making now an excellent time to recap where big money and insider knowledge are investing. Today, we’re looking at the top three stocks bought by US Congresspeople in Q1 2024, and the list is telling. The top three by activity and volume are some of the most heavily traded stocks on the market and are setting up for buying opportunities in Q2.
Palo Alto Networks Is the Most Bought Stock By Congress
Palo Alto Networks (NASDAQ: PANW) is the most bought by Congress, with two members making three trades in Q1. It is not the level of activity that has it in the first position but the volume of trading, which is fast approaching $1 billion on a YTD basis. The purchases are by William R. Keating, Representative (MA-D) and Nancy Pelosi, Representative (CA-D). Mr. Keating bought less than $15,000 worth of PANW while Mrs. Pelosi the remainder. Because the 2nd most heavily bought name by volume traded at less than 20% of the volume, Mrs. Pelosi is a whale among minnows.
Among the interesting details are the timing of the purchases. Mrs. Pelosi bought the first and larger lot ahead of the FQ2 release and the 2nd after, showing commitment to the trade as she dollar-cost-averaged into a larger position. The cause for the post-release plunge is an opportunity for investors. Palo Alto is leaning into customer acquisition and positioning for long-term growth at the expense of margin. The takeaway is that this fortress business has the resources to carry out its plans, which should result in accelerated growth in 2025 and beyond.
The analysts' activity following the report is mixed but also telling. The net result is that sentiment remains firm at Moderate Buy for this tech stock, and the price target, which is 10% above the current action, has increased.
Costco Has More Congressional Buyers Than Any Other Stock
Costco Wholesale (NASDAQ: COST) is #6 in terms of volume, but more members of Congress are buying it than any other stock. Three members made four transactions amounting to roughly $56,500 in value. Buyers include Kathy D. Manning, Representative (D-NC), Kevin Hearn, Representative (R-OK), and Pete Sessions, Representative (R-TX).
The bulk of the purchase was made by Ms. Manning, who purchased two lots on the same day in late January. Shares of Costco have advanced since then but are setting up for another entry. The market peaked ahead of its latest earnings report, which was confirmed in the wake. The move may not result in a complete reversal, but a move to more solid support near $650 is possible.
The cause for the pull-back is value and results. The valuation was pushed to the top of the historic range ahead of the release due to growth, expected strength, and capital returns, including the recent special dividend. Results aligned with the expectations for growth and special dividends, which will not be repeated this year. Now, the market is reverting to the trend.
Apple Is Among the Most Bought Stocks By Congresspeople In Q1
Apple (NASDAQ: AAPL), a market darling, is high on the list of stocks actively traded by Congress and for volume. It is #2 regarding activity with three trades by three members and #3 by volume at $83,500. Members who bought include Pete Session, Markwayne Mullin, and Tommy Tuberville, all Republicans representing Texas, Oklahoma, and Alabama. Purchases were made in early and late January and late February, with Mr. Sessions buying the least and Mr. Mullin the most.
The price action in Apple caused a loss for these distinguished gentlemen, and the losses may deepen. The news for Apple hasn’t been bullish of late and is helping the market move lower. Highlights include scrapping plans for an EV, hefty fines and antitrust issues. The company is also lagging in the push toward AI, which is a potential catalyst. The company is expected to make significant announcements regarding AI over the next few months, including at the Worldwide Developer Conference.
