Possible bearish signals as Waste Connections, Inc. (NYSE:WCN) insiders disposed of US$5.0m worth of stock
The fact that multiple Waste Connections, Inc. (NYSE:WCN) insiders offloaded a considerable amount of shares over the past year could have raised some eyebrows amongst investors. When analyzing insider transactions, it is usually more valuable to know whether insiders are buying versus knowing if they are selling, as the latter sends an ambiguous message. However, if numerous insiders are selling, shareholders should investigate more.
Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.
Check out our latest analysis for Waste Connections
The Last 12 Months Of Insider Transactions At Waste Connections
Over the last year, we can see that the biggest insider sale was by the Chief Accounting & Tax Officer and Senior VP, Matthew Black, for US$1.2m worth of shares, at about US$138 per share. That means that an insider was selling shares at around the current price of US$133. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. 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.
Over the last year we saw more insider selling of Waste Connections shares, than buying. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
I will like Waste Connections better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.
Waste Connections Insiders Are Selling The Stock
The last quarter saw substantial insider selling of Waste Connections shares. In total, insiders sold US$1.4m 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.
Does Waste Connections 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 Waste Connections insiders own 0.3% of the company, worth about US$103m. 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 Does This Data Suggest About Waste Connections Insiders?
Insiders sold stock recently, but they haven't been buying. And our longer term analysis of insider transactions didn't bring confidence, either. But since Waste Connections 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. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Waste Connections. In terms of investment risks, we've identified 2 warning signs with Waste Connections and understanding them should be part of your investment process.
Of course Waste Connections 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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