What the Insiders Are Really Selling in These Mergers

The real test of management's confidence isn't in press releases or deal memos. It's in the trades they make with their own money. Across these three companies, a pattern of insider selling and zero-cost grants tells a story that contradicts the hype around the proposed mergers. When the people running the show are cashing out while taking new stock for free, it's a classic red flag that their skin isn't truly in the game.

Let's start with the CEO of Allegiant Travel. Julia Hartz received a stock award grant at $0.00 per share just last month, on December 19. That's a gift, pure and simple. Yet earlier in the year, she was also selling shares. This is a textbook misalignment: taking a new, zero-cost award while simultaneously reducing her direct ownership. It suggests she's not betting her own capital on the deal's promised value.

The CFO at Eventbrite, Kenneth R. Hahn, has been even more active. In August 2025, he sold over 1.1 million shares at prices between $11.87 and $11.92. That's a massive, non-trivial sale of personal wealth. He also took a stock award grant earlier in the year. The math is clear: he's been selling at a premium to the current market price while also accepting new stock at no cost. This is the kind of behavior that often precedes a deal that looks good on paper but leaves insiders on the sidelines.

Then there's Coursera's CEO, Gregory Hart. His move was more subtle but equally telling. On February 3, 2026, he withheld 185,653 shares for taxes on restricted stock unit vesting. While not an open-market sale, this is still a reduction in his direct ownership. It's a non-market way to cash out, and it happened just weeks after the merger news. It shows he's not waiting to see if the deal works out before taking some chips off the table.

Finally, we see the pattern extend to the board. Eventbrite director Sean P. Moriarty received 4,063 shares at $0.00 per share on January 15, 2026, as part of his director compensation. This is a zero-cost grant, a benefit to insiders that doesn't require them to put any of their own money at risk. It's a reminder that the alignment of interest is often skewed toward the board and executives who are getting paid in stock, not the shareholders who are asked to fund the deal.

The bottom line is that the smart money is not buying. It's selling or taking free stock. When CEOs and CFOs are cashing out while accepting new zero-cost awards, it's a powerful signal that they lack confidence in the proposed deal valuations. In a true alignment of interest, you'd see more skin in the game, not less.

Smart Money Signals: Institutional and Congressional Moves

The insider selling we've seen is one signal. But to get the full picture, we need to look at the moves of two other key groups: institutional investors and members of Congress. Their trades often reflect a more cautious, long-term view of value and risk.

First, the lawmakers. Congressional trading in Allegiant Travel (ALGT) shows a pattern of back-and-forth activity. Representative Josh Gottheimer, for instance, has made multiple sales and purchases over the past few years, with no clear directional trend. This kind of mixed activity is common and doesn't necessarily signal a major bet either way. It suggests lawmakers are managing their personal portfolios, not making a coordinated call on the merger's value. The lack of a strong, consistent buying or selling pattern here provides no clear green light from that quarter.

More telling is the institutional picture. Eventbrite's stock price tells a stark story of institutional caution. The stock has fallen over 59% from its 52-week high and is now trading near its lowest point in that period. That kind of sustained decline, especially after the merger announcement, often reflects a loss of confidence from professional money managers. When institutions are selling into weakness and not stepping in to buy, it can be a sign they see limited upside or heightened risk in the deal structure.

This institutional skepticism aligns with the legal action being taken. The investigation by Halper Sadeh LLC into the Allegiant-Sun Country merger focuses on whether the deal provides fair consideration for shareholders. The firm is probing whether management and the board are fulfilling their fiduciary duties to get the best possible deal. This legal scrutiny implies a potential conflict between what insiders are doing and what shareholders are being asked to accept. If the investigation finds merit, it would validate the skepticism we see in the market and among insiders.

Put it all together. While Congress shows no clear trend, the stock price collapse and the formal investigation point to a broader environment of caution. The smart money-both the institutional whales and the legal watchdogs-is not betting on these deals. They are either selling, staying on the sidelines, or actively questioning the terms. When the professionals and the regulators are looking over the deal's shoulder, it's a powerful signal that the skin in the game for ordinary shareholders may be greater than it is for those running the companies.

Valuation and Catalysts: What to Watch for Fairness

The financial terms of these deals provide the hard numbers behind the insider skepticism. When the math doesn't add up for shareholders, it's a clear signal that the smart money is right to be cautious.

Take the Allegiant-Sun Country merger. The proposed structure gives Allegiant shareholders a controlling stake, but it's a costly one. Upon completion, Allegiant shareholders will own approximately 67% of the combined company. That means they are getting a majority of a new entity, but they are also diluting their ownership in their own company to achieve it. This is a classic case of skin in the game for insiders who are selling, while shareholders are asked to fund the deal with their capital. The valuation here is less about the standalone value of Allegiant and more about the control premium insiders are securing for themselves.

Eventbrite's situation is even more stark. The company is being sold for a mere $4.50 in cash per share. That price is a fraction of its historical highs, trading near its 52-week low of $1.80. The market has already decided the standalone business has little value. Selling at $4.50 now is essentially a fire-sale price, which raises a red flag about the fairness of the deal. Why would a buyer pay a premium for a company that the public market has already written off?

The primary catalyst that will determine if the insider actions were prescient is the outcome of the Halper Sadeh investigation. This legal probe is the direct result of the skepticism we've seen in the market and among insiders. The firm is investigating whether management and the board failed to obtain the best possible consideration for shareholders. If the investigation finds merit, it could force a revised deal with better terms or trigger a shareholder lawsuit. The investigation itself is a powerful signal that the deal's fairness is in serious doubt.

The bottom line is that the valuation terms and the catalysts align perfectly with the earlier signals. The insider selling, the institutional price collapse, and the congressional back-and-forth all point to a lack of confidence. The financial math of the deals-dilution for control and fire-sale prices-explains why. The Halper Sadeh investigation is the next major test. If it validates the concerns, it will prove the smart money was right to look away. If it clears the deal, it will be a rare case where the insiders' actions were a red herring. For now, the evidence suggests the former.