37% Of This QuantumScape Insider's Holdings Were Sold

Looking at QuantumScape Corporation's (NYSE:QS ) insider transactions over the last year, we can see that insiders were net sellers. That is, there were more number of shares sold by insiders than there were purchased.

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.

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QuantumScape Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by the Chief Legal Officer & Head of Corporate Development, Michael McCarthy, for US$1.0m worth of shares, at about US$6.58 per share. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. The good news is that this large sale was at well above current price of US$4.23. So it may not shed much light on insider confidence at current levels. Michael McCarthy was the only individual insider to sell shares in the last twelve months.

Michael McCarthy ditched 316.28k shares over the year. The average price per share was US$6.02. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

View our latest analysis for QuantumScape

I will like QuantumScape better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.

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. A high insider ownership often makes company leadership more mindful of shareholder interests. QuantumScape insiders own 8.3% of the company, currently worth about US$209m based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Do The QuantumScape Insider Transactions Indicate?

The fact that there have been no QuantumScape insider transactions recently certainly doesn't bother us. While we feel good about high insider ownership of QuantumScape, we can't say the same about the selling of shares. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. When we did our research, we found 2 warning signs for QuantumScape (1 is a bit unpleasant!) that we believe deserve your full attention.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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.