Some Ares Management Corporation (NYSE:ARES) shareholders may be a little concerned to see that the Director, Robert DeVeer, recently sold a substantial US$29m worth of stock at a price of US$136 per share. That diminished their holding by a very significant 84%, which arguably implies a strong desire to reallocate capital.
Ares Management Insider Transactions Over The Last Year
Notably, that recent sale by Robert DeVeer is the biggest insider sale of Ares Management shares that we've seen in the last year. That means that an insider was selling shares at around the current price of US$135. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. We note that this sale took place at around the current price, so it isn't a major concern, though it's hardly a good sign.
Over the last year, we can see that insiders have bought 11.23k shares worth US$1.1m. But they sold 338.18k shares for US$40m. All up, insiders sold more shares in Ares Management 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. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
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Insider Ownership
For a common shareholder, it is worth checking how many shares are held by company 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. Ares Management insiders own about US$1.9b worth of shares (which is 4.7% 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.
So What Do The Ares Management Insider Transactions Indicate?
An insider sold stock recently, but they haven't been buying. Zooming out, the longer term picture doesn't give us much comfort. But since Ares Management is profitable and growing, we're not too worried by this. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. 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. For example, Ares Management has 4 warning signs (and 2 which make us uncomfortable) we think you should know about.
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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.