U.S. Markets open in 8 hrs 26 mins
  • S&P Futures

    3,257.25
    +19.25 (+0.59%)
     
  • Dow Futures

    26,877.00
    +162.00 (+0.61%)
     
  • Nasdaq Futures

    10,953.75
    +62.00 (+0.57%)
     
  • Russell 2000 Futures

    1,461.10
    +14.10 (+0.97%)
     
  • Crude Oil

    40.54
    +0.23 (+0.57%)
     
  • Gold

    1,875.60
    -1.30 (-0.07%)
     
  • Silver

    23.35
    +0.16 (+0.69%)
     
  • EUR/USD

    1.1673
    -0.0003 (-0.0233%)
     
  • 10-Yr Bond

    0.6660
    0.0000 (0.00%)
     
  • Vix

    28.51
    -0.07 (-0.24%)
     
  • GBP/USD

    1.2759
    +0.0008 (+0.0600%)
     
  • BTC-USD

    10,703.56
    -57.03 (-0.53%)
     
  • CMC Crypto 200

    217.95
    +9.01 (+4.31%)
     
  • FTSE 100

    5,822.78
    -76.48 (-1.30%)
     
  • Nikkei 225

    23,194.46
    +106.64 (+0.46%)
     

Should You Take Comfort From Insider Transactions At Sempra Energy (NYSE:SRE)?

Simply Wall St

We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So before you buy or sell Sempra Energy (NYSE:SRE), you may well want to know whether insiders have been buying or selling.

Do Insider Transactions Matter?

It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, rules govern insider transactions, and certain disclosures are required.

Insider transactions are not the most important thing when it comes to long-term investing. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Harvard University study found that 'insider purchases earn abnormal returns of more than 6% per year'.

Check out our latest analysis for Sempra Energy

Sempra Energy Insider Transactions Over The Last Year

The CFO & Executive VP, Trevor Mihalik, made the biggest insider sale in the last 12 months. That single transaction was for US$1.3m worth of shares at a price of US$125 each. So what is clear is that an insider saw fit to sell at around the current price of US$123. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. We note that this sale took place at around the current price, so it isn't a major concern, though it's hardly a good sign. The only individual insider seller over the last year was Trevor Mihalik.

In the last twelve months insiders purchased 10.45k shares for US$1.4m. But insiders sold 10.28k shares worth US$1.3m. In the last twelve months there was more buying than selling by Sempra Energy insiders. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

insider-trading-volume
insider-trading-volume

Sempra Energy is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

Insiders at Sempra Energy Have Sold Stock Recently

We've seen more insider selling than insider buying at Sempra Energy recently. We note CFO & Executive VP Trevor Mihalik cashed in US$1.3m worth of shares. On the flip side, insiders spent US$964k on purchasing shares. Because the selling vastly outweighs the buying, we'd say this is a somewhat bearish sign.

Does Sempra Energy Boast High Insider Ownership?

Many investors like to check how much of a company is owned by insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. It appears that Sempra Energy insiders own 0.1% of the company, worth about US$51m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

What Might The Insider Transactions At Sempra Energy Tell Us?

The stark truth for Sempra Energy is that there has been more insider selling than insider buying in the last three months. On the other hand, the insider transactions over the last year are encouraging. And insiders do own shares. So we're not overly bothered by recent 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. To help with this, we've discovered 3 warning signs (1 is concerning!) that you ought to be aware of before buying any shares in Sempra Energy.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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.

This article by Simply Wall St is general in nature. 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.

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