Some PagerDuty, Inc. (NYSE:PD) shareholders may be a little concerned to see that the CEO & Chairperson, Jennifer Tejada, recently sold a whopping US$6.8m worth of stock at a price of US$17.30 per share. Probably the most concerning element of the whole transaction is that the dump amounted to 52% of their entire holding.
The Last 12 Months Of Insider Transactions At PagerDuty
The Co-Founder, Dan Solomon, made the biggest insider sale in the last 12 months. That single transaction was for US$7.6m worth of shares at a price of US$22.32 each. While we don’t usually like to see insider selling, it’s more concerning if the sales take place at a lower price. The good news is that this large sale was at well above current price of US$16.30. So it is hard to draw any strong conclusion from it.
PagerDuty insiders didn’t buy any shares over the last year. The chart below shows insider transactions (by individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!
I will like PagerDuty better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.
Does PagerDuty Boast High Insider Ownership?
Many investors like to check how much of a company is owned by insiders. I reckon it’s a good sign if insiders own a significant number of shares in the company. PagerDuty insiders own 12% of the company, currently worth about US$166m 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 Do The PagerDuty Insider Transactions Indicate?
An insider sold PagerDuty shares recently, but they didn’t buy any. And there weren’t any purchases to give us comfort, over the last year. 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. So these insider transactions can help us build a thesis about the stock, but it’s also worthwhile knowing the risks facing this company. When we did our research, we found 3 warning signs for PagerDuty (1 is a bit unpleasant!) that we believe deserve your full attention.
But note: PagerDuty may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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, but not derivative transactions.
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