Insiders seem to have made the most of their holdings by selling US$106m worth of Salesforce, Inc. (NYSE:CRM) stock at an average sell price of US$173 during the past year. The company’s market cap plunged by US$10b after price dropped by 6.4% last week but insiders were able to limit their loss to an extent.
While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.
Salesforce Insider Transactions Over The Last Year
In the last twelve months, the biggest single sale by an insider was when the Co-Founder, Marc Benioff, sold US$53m worth of shares at a price of US$182 per share. While we don’t usually like to see insider selling, it’s more concerning if the sales take place at a lower price. The good news is that this large sale was at well above current price of US$145. So it may not shed much light on insider confidence at current levels.
Salesforce insiders didn’t buy any shares over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
I will like Salesforce better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.
Insider Ownership Of Salesforce
For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. It’s great to see that Salesforce insiders own 3.1% of the company, worth about US$4.6b. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
So What Does This Data Suggest About Salesforce Insiders?
It doesn’t really mean much that no insider has traded Salesforce shares in the last quarter. It’s great to see high levels of insider ownership, but looking back over the last year, we don’t gain confidence from the Salesforce insiders selling. While we like knowing what’s going on with the insider’s ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. While conducting our analysis, we found that Salesforce has 3 warning signs and it would be unwise to ignore them.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently account for open market transactions and private dispositions, but not derivative transactions.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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