Over the past year, many Signet Jewelers Limited (NYSE:SIG) insiders sold a significant stake in the company which may have piqued investors' interest. Knowing whether insiders are buying is usually more helpful when evaluating insider transactions, as insider selling can have various explanations. However, if numerous insiders are selling, shareholders should investigate more.
Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.
View our latest analysis for Signet Jewelers
Signet Jewelers Insider Transactions Over The Last Year
The Chief Digital Innovation Officer & President of Digital Banners, Oded Edelman, made the biggest insider sale in the last 12 months. That single transaction was for US$731k worth of shares at a price of US$73.14 each. That means that an insider was selling shares at slightly below the current price (US$101). 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 5.0% of Oded Edelman's holding.
Insiders in Signet Jewelers didn't buy any shares in the last year. 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!
I will like Signet Jewelers better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.
Insiders At Signet Jewelers Have Sold Stock Recently
Over the last three months, we've seen significant insider selling at Signet Jewelers. In total, Chief Supply Chain Officer Stephen Lovejoy sold US$222k worth of shares in that time, and we didn't record any purchases whatsoever. In light of this it's hard to argue that all the insiders think that the shares are a bargain.
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. Signet Jewelers insiders own about US$159m worth of shares (which is 3.6% of the company). 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 Signet Jewelers Tell Us?
An insider sold stock recently, but they haven't been buying. And there weren't any purchases to give us comfort, over the last year. On the plus side, Signet Jewelers makes money, and is growing profits. While insiders do own a lot of shares in the company (which is good), our analysis of their transactions doesn't make us feel confident about the company. Of course, the future is what matters most. So if you are interested in Signet Jewelers, you should check out this free report on analyst forecasts for the company.
Of course Signet Jewelers 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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