In the last year, many CF Industries Holdings, Inc. (NYSE:CF) insiders sold a substantial stake in the company which may have sparked shareholders' attention. 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, 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.
View our latest analysis for CF Industries Holdings
CF Industries Holdings Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider sale was by the Executive VP of Corporate Development & Legal Advisor, Douglas Barnard, for US$1.0m worth of shares, at about US$61.28 per share. That means that an insider was selling shares at slightly below the current price (US$77.46). We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. However, while insider selling is sometimes discouraging, it's only a weak signal. We note that the biggest single sale was only 41% of Douglas Barnard's holding.
CF Industries Holdings insiders didn't buy any shares over the last year. 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).
CF Industries Holdings Insiders Are Selling The Stock
Over the last three months, we've seen significant insider selling at CF Industries Holdings. In total, Executive Vice President of Sales Bert Frost sold US$793k 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.
Insider Ownership
For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 0.5% of CF Industries Holdings shares, worth about US$72m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
So What Does This Data Suggest About CF Industries Holdings Insiders?
An insider sold stock recently, but they haven't been buying. And even if we look at the last year, we didn't see any purchases. While insiders do own shares, they don't own a heap, and they have been selling. We'd practice some caution before buying! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing CF Industries Holdings. For instance, we've identified 2 warning signs for CF Industries Holdings (1 is a bit unpleasant) you should be aware of.
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 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.