Need To Know: Tableau Software, Inc. (NYSE:DATA) Insiders Have Been Selling Shares
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 we’ll take a look at whether insiders have been buying or selling shares in Tableau Software, Inc. (NYSE:DATA).
What Is Insider Buying?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, most countries require that the company discloses such transactions to the market.
We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But logic dictates you should pay some attention to whether insiders are buying or selling shares. As Peter Lynch said, ‘insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.’
Check out our latest analysis for Tableau Software
Tableau Software Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider sale was by CEO, President & Executive Director Adam Selipsky for US$805k worth of shares, at about US$117 per share. That means that even when the share price was below the current price of US$125, an insider wanted to cash in some shares. While their view may have changed since they sold, this isn’t a particularly bullish sign. We generally consider it a negative if insiders have been selling on market, especially if they did so below the current price. We note that the biggest single sale was only 9.2% of Adam Selipsky’s holding.
We note that in the last year insiders divested 80.21k shares for a total of US$7.6m. All up, insiders sold more shares in Tableau Software than they bought, over the last year. The average sell price was around US$95.33. We don’t gain much confidence from insider selling near the recent share price. While some insiders have decided to take some money off the table, we wouldn’t put too much weight on this fact. The chart below shows insider transactions 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!
I will like Tableau Software better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.
Tableau Software Insiders Are Selling The Stock
The last three months saw significant insider selling at Tableau Software. In total, insiders sold US$1.7m worth of shares in that time, and we didn’t record any purchases whatsoever. Overall this makes us a bit cautious, but it’s not the be all and end all.
Insider Ownership
Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. Tableau Software insiders own 14% of the company, currently worth about US$1.4b based on the recent share price. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.
So What Does This Data Suggest About Tableau Software Insiders?
Insiders sold Tableau Software shares recently, but they didn’t buy any. And even if we look to the last year, we didn’t see any purchases. It is good to see high insider ownership, but the insider selling leaves us cautious. Therefore, you should should definitely take a look at this FREE report showing analyst forecasts for Tableau Software.
Of course Tableau Software may not be the best stock to buy. So you may wish to see this free collection of high quality companies.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.
