Insider Sales at Pagaya: Responsible Management or Reason for Alarm?

The recent sale of nearly 300,000 shares by Yahav Yulzari, Chief Business Officer and Director of Pagaya Technologies, has raised questions among investors. However, when analyzed within the framework of pre-arranged 10b5-1 trading plans and Pagaya’s overall strong financial performance, these transactions appear more like a calculated strategy of managing investments rather than a cause for concern. Let’s delve into how this impacts investor confidence and the valuation of the company.

The 10b5-1 trading plan that Yahav Yulzari utilized for his June sales totaling $5.8 million is evident in the Securities and Exchange Commission (SEC) Form 4 filings. This plan allows company insiders to establish predetermined selling parameters such as dates, prices, and volumes in advance, shielding these transactions from potential accusations of insider trading. It’s essential to note a few key points:

Firstly, the timing of the sales on June 24 and 25 adhered to a plan set in place before these dates, thereby eliminating any claims of trying to time the market. Yulzari retained 93% of his holdings, which is approximately 3.85 million shares, indicating his ongoing commitment to long-term shareholder value. Furthermore, the shares were sold within a price range of $19.11 to $20.60, reflecting compliance with market conditions rather than selling at artificially inflated prices.

Looking at Pagaya’s first-quarter results for 2025 provides valuable context. The company achieved record revenue of $290 million, marking an 18% year-over-year increase, surpassing projections and constituting its most robust quarter to date. Additionally, Pagaya reported its first GAAP profit of $8 million net income, a significant milestone following years of losses. The implementation of its $1 billion POSH point-of-sale lending program, which garnered interest from more than 20 institutional investors, underscores market confidence in its AI-driven asset-backed securities (ABS).

In the market landscape, Pagaya’s stock has soared by 102.9% year-to-date, outstripping its fintech peers such as LendingClub (down 30.7%) and LendingTree (down 10.7%). This surge is a result of structural tailwinds favoring the fintech sector’s movement towards institutional-grade solutions, where Pagaya’s AI platform and AAA-rated ABS deals worth $1.1 billion in 2025 give it a competitive edge. The company’s inclusion in the Russell 3000 Growth Index in June 2025 led to passive inflows, amplifying liquidity and visibility.

While critics may view any insider selling as a red flag, several factors suggest otherwise. Yulzari’s 93% stake retention aligns with executive norms when using 10b5-1 plans for tax or diversification reasons. The sales coincided with the stock nearing a 52-week high, presenting a logical opportunity to secure gains while retaining potential upside. Institutional investors holding over 57% of shares alongside analysts upholding a “Strong Buy” consensus with a price target of $23.19—$2.34 above current levels—further support a positive outlook.

For investors evaluating Pagaya’s insider activity against its performance, maintaining or accumulating shares may be prudent. The stock’s valuation, with a price-to-book ratio of 3.23X compared to the sector average of 3.47X, remains reasonable. Analysts anticipate a revenue growth of 19.9% in 2025, with expanding margins attributed to operational efficiencies. However, it’s essential to monitor potential execution risks as Pagaya ventures into auto lending and POS financing, ensuring scalability without hindering growth narratives. Despite enhanced trading volume post-Russell 3000 inclusion, the stock’s high volatility (beta = 5.93) should not be overlooked.

In conclusion, Yulzari’s significant sales should be seen within the context of a compliance-driven strategy. Paired with Pagaya’s remarkable financial performance and industry-leading initiatives, these transactions indicate a deliberate approach to managing wealth by an insider who remains deeply invested. Investors may consider a cautiously bullish stance on the stock, given its undervalued metrics and promising growth prospects, provided Pagaya sustains its AI-driven expansion efforts.