Many Avis Budget Group, Inc. (NASDAQ:CAR) insiders ditched their stock over the past year, which may be of interest to the company's shareholders.   When evaluating insider transactions, knowing whether insiders are buying versus if they selling is usually more beneficial, as the latter can be open to many interpretations.  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.

Avis Budget Group Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by the CEO & President, Joseph Ferraro, for US$3.6m worth of shares, at about US$196 per share.   We generally don't like to see insider selling, but the lower the sale price, the more it concerns us.  It's of some comfort that this sale was conducted at a price well above the current share price, which is US$115.  So it is hard to draw any strong conclusion from it.  

In the last year Avis Budget Group insiders didn't buy any company stock.    The chart below shows insider transactions (by companies and individuals) 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!

NasdaqGS:CAR Insider Trading Volume April 15th 2024

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Insider Ownership

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own.  I reckon it's a good sign if insiders own a significant number of shares in the company.   It's great to see that Avis Budget Group insiders own 3.0% of the company, worth about US$121m.  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 Avis Budget Group Insider Transactions Indicate?

The fact that there have been no Avis Budget Group insider transactions recently certainly doesn't bother us.      It's heartening that insiders own plenty of stock, but we'd like to see more insider buying, since the last year of Avis Budget Group insider transactions don't fill us with confidence.       In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Avis Budget Group.    For instance, we've identified 4 warning signs for Avis Budget Group (3 are concerning) you should be aware of.  

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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 of direct interests only, but not derivative transactions or indirect interests.

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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.