Stock Analysis

Don't Ignore The Fact That This Insider Just Sold Some Shares In Wheaton Precious Metals Corp. (TSE:WPM)

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We'd be surprised if Wheaton Precious Metals Corp. (TSE:WPM) shareholders haven't noticed that the Non Independent Director, Glenn Ives, recently sold CA$139k worth of stock at CA$59.89 per share. The eyebrow raising move amounted to a reduction of 16% in their holding.

Check out our latest analysis for Wheaton Precious Metals

Wheaton Precious Metals Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by the Independent Director, Eduardo Arellano, for CA$1.6m worth of shares, at about CA$53.33 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of CA$62.16. 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 27% of Eduardo Arellano's stake.

In the last twelve months insiders purchased 4.00k shares for CA$204k. On the other hand they divested 32.33k shares, for CA$1.7m. All up, insiders sold more shares in Wheaton Precious Metals than they bought, over the last year. The average sell price was around US$53.74. We don't gain confidence from insider selling below the recent share price. But we wouldn't put too much weight on the insider selling. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

TSX:WPM Insider Trading Volume March 19th 2023

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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. Wheaton Precious Metals insiders own about CA$37m worth of shares. That equates to 0.1% of the company. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Does This Data Suggest About Wheaton Precious Metals Insiders?

Insider selling has just outweighed insider buying in the last three months. But the difference isn't enough to have us worried. Recent insider selling makes us a little nervous, in light of the broader picture of Wheaton Precious Metals insider transactions. But it's good to see that insiders own shares in 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. To help with this, we've discovered 2 warning signs (1 is significant!) that you ought to be aware of before buying any shares in Wheaton Precious Metals.

Of course Wheaton Precious Metals may not be the best stock to buy. So you may wish to see this free collection of high quality companies.

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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