Some The Southern Company (NYSE:SO) shareholders may be a little concerned to see that the Chairman, Kimberly Greene, recently sold a substantial US$1.5m worth of stock at a price of US$75.02 per share. That sale reduced their total holding by 15% which is hardly insignificant, but far from the worst we've seen.

The Last 12 Months Of Insider Transactions At Southern

Notably, that recent sale by Chairman Kimberly Greene was not the only time they sold Southern shares this year. They previously made an even bigger sale of -US$3.3m worth of shares at a price of US$69.78 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of US$75.85. 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. 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. This single sale was just 29% of Kimberly Greene's stake.

In the last year Southern insiders didn't buy any company stock. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

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Does Southern Boast High Insider Ownership?

For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Southern insiders own 0.2% of the company, currently worth about US$155m based on the recent share price. 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 Does This Data Suggest About Southern Insiders?

Insiders haven't bought Southern stock in the last three months, but there was some selling. And even if we look at the last year, we didn't see any purchases. But it is good to see that Southern is growing earnings. 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. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Southern. To help with this, we've discovered 3 warning signs (1 is potentially serious!) that you ought to be aware of before buying any shares in Southern.

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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.