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Don't Ignore The Fact That This Insider Just Sold Some Shares In Littelfuse, Inc. (NASDAQ:LFUS)

Simply Wall St

We note that the Littelfuse, Inc. (NASDAQ:LFUS) Lead Independent Director, John Major, recently sold US$72k worth of stock for US$182 per share. However we note that the sale only shrunk their holding by 1.5%.

See our latest analysis for Littelfuse

The Last 12 Months Of Insider Transactions At Littelfuse

In the last twelve months, the biggest single sale by an insider was when the Director, Nathan Zommer, sold US$252k worth of shares at a price of US$194 per share. So what is clear is that an insider saw fit to sell at around the current price of US$185. While we don't usually like to see insider selling, it's more concerning if the sales take place 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.

Over the last year, we can see that insiders have bought 210 shares worth US$36k. On the other hand they divested 5929 shares, for US$1.1m. All up, insiders sold more shares in Littelfuse than they bought, over the last year. The chart below shows insider transactions (by individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

NasdaqGS:LFUS Recent Insider Trading, November 7th 2019
NasdaqGS:LFUS Recent Insider Trading, November 7th 2019

For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

Insider Ownership of Littelfuse

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. We usually like to see fairly high levels of insider ownership. Littelfuse insiders own about US$116m worth of shares (which is 2.6% of the company). 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 Do The Littelfuse Insider Transactions Indicate?

The stark truth for Littelfuse is that there has been more insider selling than insider buying in the last three months. Zooming out, the longer term picture doesn't give us much comfort. But since Littelfuse is profitable and growing, we're not too worried by this. It is good to see high insider ownership, but the insider selling leaves us cautious. If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.

Of course Littelfuse may not be the best stock to buy. So you may wish to see this free collection of high quality 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.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. 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. Simply Wall St has no position in the stocks mentioned. Thank you for reading.