37% Of This SEEK Insider's Holdings Were Sold

From what we can see, insiders were net sellers in SEEK Limited's (ASX:SEK ) during the past 12 months. That is, insiders sold the stock in greater numbers than they purchased it.

Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.

See our latest analysis for SEEK

SEEK Insider Transactions Over The Last Year

The MD, CEO & Executive Director, Ian Narev, made the biggest insider sale in the last 12 months. That single transaction was for AU$4.6m worth of shares at a price of AU$23.21 each. That means that even when the share price was below the current price of AU$26.26, an insider wanted to cash in some shares. As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. This single sale was just 37% of Ian Narev's stake. Ian Narev was the only individual insider to sell over the last year.

In the last twelve months insiders purchased 3.05k shares for AU$75k. But insiders sold 230.00k shares worth AU$5.4m. Ian Narev sold a total of 230.00k shares over the year at an average price of AU$23.42. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

I will like SEEK better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

SEEK Insiders Are Selling The Stock

There was substantially more insider selling, than buying, of SEEK shares over the last three months. In total, MD, CEO & Executive Director Ian Narev sold AU$745k worth of shares in that time. On the other hand we note Independent Non-Executive Director Jamaludin Bin Ibrahim bought AU$54k worth of shares. Because the selling vastly outweighs the buying, we'd say this is a somewhat bearish sign.

Does SEEK Boast High 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. I reckon it's a good sign if insiders own a significant number of shares in the company. SEEK insiders own about AU$396m worth of shares (which is 4.2% 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 SEEK Tell Us?

The insider sales have outweighed the insider buying, at SEEK, in the last three months. Zooming out, the longer term picture doesn't give us much comfort. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. While conducting our analysis, we found that SEEK has 3 warning signs and it would be unwise to ignore them.

But note: SEEK 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 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.