Quite a few Shift4 Payments, Inc. (NYSE:FOUR) insiders sold their shares over the past year, which may be a cause for concern.   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 insider transactions are not the most important thing when it comes to long-term investing,  we would consider it foolish to ignore insider transactions altogether.

Shift4 Payments Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the Secretary, Jordan Frankel, sold US$412k worth of shares at a price of US$58.81 per share.    That means that an insider was selling shares at  slightly  below the current price (US$60.99).  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.  While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign.   It is worth noting that this sale was only 4.2% of Jordan Frankel's holding.    

Shift4 Payments insiders didn't buy any shares over the last year.    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!

NYSE:FOUR Insider Trading Volume April 25th 2024

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

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.  We usually like to see fairly high levels of insider ownership.   It's great to see that Shift4 Payments insiders own 2.9% of the company, worth about US$156m.  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 Shift4 Payments Insider Transactions Indicate?

There haven't been any insider transactions in the last three months -- that doesn't mean much.      It's heartening that insiders own plenty of stock, but we'd like to see more insider buying, since the last year of Shift4 Payments insider transactions don't fill us with confidence.       So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing.    You'd be interested to know, that we found 3 warning signs for Shift4 Payments and we suggest you have a look.  

Of course Shift4 Payments 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 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.