Nucor Corporation (NYSE:NUE) insiders sold US$11m worth of stock suggesting impending weakness.
Many Nucor Corporation (NYSE:NUE) insiders ditched their stock over the past year, which may be of interest to the company's shareholders. Knowing whether insiders are buying is usually more helpful when evaluating insider transactions, as insider selling can have various explanations. However, shareholders should take a deeper look if several insiders are selling stock over a specific time period.
While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.
See our latest analysis for Nucor
Nucor Insider Transactions Over The Last Year
The President, Leon Topalian, made the biggest insider sale in the last 12 months. That single transaction was for US$2.2m worth of shares at a price of US$112 each. So it's clear an insider wanted to take some cash off the table, even below the current price of US$170. As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. However, while insider selling is sometimes discouraging, it's only a weak signal. It is worth noting that this sale was only 13% of Leon Topalian's holding.
In the last year Nucor insiders didn't buy any company stock. 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!
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).
Insiders At Nucor Have Sold Stock Recently
Over the last three months, we've seen significant insider selling at Nucor. In total, insiders dumped US$2.6m worth of shares in that time, and we didn't record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.
Insider Ownership Of Nucor
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. It's great to see that Nucor insiders own 0.7% of the company, worth about US$286m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
So What Do The Nucor Insider Transactions Indicate?
Insiders sold Nucor shares recently, but they didn't buy any. And there weren't any purchases to give us comfort, over the last year. But since Nucor 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. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For instance, we've identified 2 warning signs for Nucor (1 shouldn't be ignored) you should be aware of.
Of course Nucor 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.
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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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