The Biden administration appears poised to issue a federal vaccine passport mandate for travel, as Becker News recently reported. Now, the President of United Airlines has left a warning sign that such a prohibitive step may be imminent, as the unconstitutional restriction on Americans’ freedom of travel is likely to send shockwaves throughout the industry.
On Friday, Nasdaq issued a ‘trade alert‘ for insider stock traders at United Airlines. It provided a sobering assessment of the insider stock trades for United Airlines:
Some United Airlines Holdings, Inc. (NASDAQ:UAL) shareholders may be a little concerned to see that the President, Brett Hart, recently sold a substantial US$3.5m worth of stock at a price of US$45.14 per share. Probably the most concerning element of the whole transaction is that the disposal amounted to 69% of their entire holding.
Over the last year, we can see that the biggest insider sale was by the insider, Oscar Munoz, for US$4.6m worth of shares, at about US$40.24 per share. That means that an insider was selling shares at slightly below the current price (US$44.34). We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. However, while insider selling is sometimes discouraging, it’s only a weak signal. This single sale was just 46% of Oscar Munoz’s stake.
In total, United Airlines Holdings insiders sold more than they bought over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
The following chart was provided by Nasdaq.com:
Delta Airlines President Glen Hauenstein has sold significant share holdings in 2021, but there is no registry for a transaction in the last month, though it bears monitoring. American Airlines President Robert Isom similarly does not have recent stock transactions and has been generally bullish on the company’s future.
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United Airlines recently fired employees who refused to submit to the company’s Covid vaccine mandate. On Wednesday, United Airlines Chief Executive Scott Kirby argued that the company’s decision to fire employees who defied its vaccine mandate will not affect the carrier’s operations.
“In early August, the company became the first U.S. carrier to require COVID-19 vaccinations for all domestic employees, requiring proof of vaccination by Monday,” CNBC reported. “The carrier said it would start on Tuesday the process of firing 593 employees who decided not to get vaccinated.”
“This was an incredibly difficult decision but keeping our team safe has always been our first priority,” Chief Executive Scott Kirby and President Brett Hart told employees in a memo.
Meanwhile, Altimeter Capital Chairman and CEO Brad Gerstner said his hedge fund sold stakes in United Airlines and Expedia, adding that ‘easy gains from the rebound in travel stocks have been realized,’ CNBC noted.
“On July 1 this year after a big run-up in United and Expedia, we distributed those returns to investors. … I still think the travel stocks will be fine. … There will be some winners and losers but easy gains off the Covid bottom have certainly been made,” Gerstner said Wednesday at CNBC’s Delivering Alpha conference.
“Shares of United have gained 12.6% year to date, while Expedia shares have jumped 25.6% in 2021,” CNBC added. United Airlines (UAL) is down 2.34% after market open as of time of publication. Delta Airlines (DAL) was down 1.73%, while American Airlines (AAL) was down 2.33%.
On Wednesday, Senator Dianne Feinstein (D-CA) introduced the U.S. Air Travel Public Safety Act, a bill that would “require all passengers on domestic airline flights to either be fully vaccinated, have recently tested negative for COVID-19 or have fully recovered from COVID-19.”
“The bill would require the Secretary of Health and Human Services, in consultation with the Federal Aviation Administration, to develop national vaccination standards and procedures related to COVID-19 and domestic air travel in order to prevent future outbreaks of the disease,” Sen. Feinstein’s press release stated.
Congressional Republican lawmakers on Wednesday attempted to get ahead of executive order to mandate vaccines for domestic travel by introducing legislation to block such an unconstitutional directive.
“In a Wednesday speech on the Senate floor, Sen. Rick Scott (R-Fla.), joined by Sens. Ron Johnson (R-Wis.) and Mike Lee (R-Utah), introduced legislation that would bar the Biden administration from implementing vaccine passports requirements for interstate travel,” the Epoch Times reported.
The Prevent Unconstitutional Vaccine Mandates for Interstate Commerce Act, would “prohibit several federal agencies involved in interstate commerce and travel from requiring proof of vaccination: The Department of Transportation, which oversees the Federal Aviation Administration, the National Railroad Passenger Corporation (Amtrak), the Surface Transportation Board, the Transportation Security Administration, the National Transportation Safety Board, the Federal Maritime Commission, and the Department of Commerce,” according to the report.
A review of recent House and Senate stock transactions did not yet note a travel industry sell-off, but Becker News will continue to monitor for potential trades and will provide updates if those are reported.
OPINION: This article contains commentary which reflects the author's opinion.