Have Origin Energy Insiders Been Selling Stock?

We wouldn't blame Origin Energy Limited (ASX:ORG) shareholders if they were a little worried about the fact that Frank Calabria, the MD, CEO & Executive Director recently netted about AU$2.0m selling shares at an average price of AU$12.34. However, it's crucial to note that they remain very much invested in the stock and that sale only reduced their holding by 6.9%.

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The Last 12 Months Of Insider Transactions At Origin Energy

Notably, that recent sale by Frank Calabria is the biggest insider sale of Origin Energy shares that we've seen in the last year. So it's clear an insider wanted to take some cash off the table, even slightly below the current price of AU$12.45. When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. 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. We note that the biggest single sale was only 6.9% of Frank Calabria's holding.

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!

See our latest analysis for Origin Energy

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Insider Ownership

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. Insiders own 0.2% of Origin Energy shares, worth about AU$51m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

So What Do The Origin Energy Insider Transactions Indicate?

Unfortunately, there has been more insider selling of Origin Energy stock, than buying, in the last three months. Despite some insider buying, the longer term picture doesn't make us feel much more positive. On the plus side, Origin Energy makes money, and is growing profits. Insider ownership isn't particularly high, so this analysis makes us cautious about the company. We'd practice some caution before buying! While it's good to be aware of 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. Be aware that Origin Energy is showing 3 warning signs in our investment analysis, and 1 of those can't be ignored...

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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.