Don't Ignore The Insider Selling In J Sainsbury

Some J Sainsbury plc (LON:SBRY) shareholders may be a little concerned to see that the CEO, Director & Chairman of Operating Board, Simon Roberts, recently sold a substantial UK£1.6m worth of stock at a price of UK£2.84 per share. That's a big disposal, and it decreased their holding size by 20%, which is notable but not too bad.

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J Sainsbury Insider Transactions Over The Last Year

Notably, that recent sale by Simon Roberts is the biggest insider sale of J Sainsbury 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 UK£2.89. 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. It is worth noting that this sale was only 20% of Simon Roberts's holding.

In the last year J Sainsbury insiders didn't buy any company stock. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

Check out our latest analysis for J Sainsbury

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Insider Ownership Of J Sainsbury

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. A high insider ownership often makes company leadership more mindful of shareholder interests. It appears that J Sainsbury insiders own 0.2% of the company, worth about UK£9.9m. 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 J Sainsbury Insiders?

Insiders haven't bought J Sainsbury stock in the last three months, but there was some selling. Looking to the last twelve months, our data doesn't show any insider buying. But it is good to see that J Sainsbury is growing earnings. Insiders own relatively few shares in the company, and when you consider the sales, we're not particularly excited about the stock. So we're not rushing to buy, to say the least. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing J Sainsbury. Every company has risks, and we've spotted 2 warning signs for J Sainsbury you should know about.

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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.