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As American Tower Corporation's (NYSE:AMT)) market cap dropped by US$5.7b, insiders who sold US$660k worth of stock were able to offset their losses

·3 min read

By selling US$660k worth of American Tower Corporation (NYSE:AMT) stock at an average sell price of US$236 over the last year, insiders seemed to have made the most of their holdings. The company's market valuation decreased by US$5.7b after the stock price dropped 5.0% over the past week, but insiders were spared from painful losses.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

Check out our latest analysis for American Tower

The Last 12 Months Of Insider Transactions At American Tower

Over the last year, we can see that the biggest insider sale was by the Senior VP & Chief Accounting Officer, Robert Meyer, for US$660k worth of shares, at about US$236 per share. So what is clear is that an insider saw fit to sell at around the current price of US$233. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. Given that the sale took place at around current prices, it makes us a little cautious but is hardly a major concern. The only individual insider seller over the last year was Robert Meyer.

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!

insider-trading-volume
insider-trading-volume

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: insiders have been buying them).

Does American Tower Boast High Insider Ownership?

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. We usually like to see fairly high levels of insider ownership. It's great to see that American Tower insiders own 0.3% of the company, worth about US$332m. 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 American Tower Insiders?

The fact that there have been no American Tower insider transactions recently certainly doesn't bother us. While we feel good about high insider ownership of American Tower, we can't say the same about the selling of shares. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing American Tower. Be aware that American Tower is showing 2 warning signs in our investment analysis, and 1 of those is concerning...

But note: American Tower may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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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