Wells Fargo Insiders Sell US$1.6m Of Stock, Possibly Signalling Caution
Many Wells Fargo & Company (NYSE:WFC) insiders ditched their stock over the past year, which may be of interest to the company's shareholders. 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, shareholders should take a deeper look if several insiders are selling stock over a specific time period.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.
See our latest analysis for Wells Fargo
The Last 12 Months Of Insider Transactions At Wells Fargo
The insider, Kleber Santos, made the biggest insider sale in the last 12 months. That single transaction was for US$1.6m worth of shares at a price of US$46.27 each. So we know that an insider sold shares at around the present share price of US$43.72. While insider selling is a negative, to us, it is more negative if the shares are sold 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.
In total, Wells Fargo insiders sold more than they bought over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!
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).
Insider Ownership Of Wells Fargo
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. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Wells Fargo insiders own 0.07% of the company, currently worth about US$116m based on the recent share price. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
What Might The Insider Transactions At Wells Fargo Tell Us?
It doesn't really mean much that no insider has traded Wells Fargo shares in the last quarter. It's great to see high levels of insider ownership, but looking back over the last year, we don't gain confidence from the Wells Fargo insiders selling. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Wells Fargo. Every company has risks, and we've spotted 1 warning sign for Wells Fargo you should know about.
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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
