Kinaxis Insiders Sold US$10m Of Shares Suggesting Hesitancy

The fact that multiple Kinaxis Inc. (TSE:KXS) insiders offloaded a considerable amount of shares over the past year could have raised some eyebrows amongst investors. When evaluating insider transactions, knowing whether insiders are buying is usually more beneficial than knowing whether they are selling, as the latter can be open to many interpretations. However, shareholders should take a deeper look if several insiders are selling stock over a specific time period.

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 Kinaxis

The Last 12 Months Of Insider Transactions At Kinaxis

The CEO, President & Director, John Sicard, made the biggest insider sale in the last 12 months. That single transaction was for CA$4.4m worth of shares at a price of CA$152 each. That means that an insider was selling shares at slightly below the current price (CA$168). 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. We note that the biggest single sale was only 9.4% of John Sicard's holding.

Over the last year we saw more insider selling of Kinaxis shares, than buying. 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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Insiders At Kinaxis Have Sold Stock Recently

The last quarter saw substantial insider selling of Kinaxis shares. Specifically, insiders ditched CA$3.8m worth of shares in that time, and we didn't record any purchases whatsoever. In light of this it's hard to argue that all the insiders think that the shares are a bargain.

Does Kinaxis 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. We usually like to see fairly high levels of insider ownership. It appears that Kinaxis insiders own 1.3% of the company, worth about CA$59m. 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 Does This Data Suggest About Kinaxis Insiders?

Insiders sold Kinaxis shares recently, but they didn't buy any. Zooming out, the longer term picture doesn't give us much comfort. On the plus side, Kinaxis makes money, and is growing profits. Insiders own shares, but we're still pretty cautious, given the history of sales. So we'd only buy after careful consideration. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Kinaxis. You'd be interested to know, that we found 1 warning sign for Kinaxis and we suggest you have a look.

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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.

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