Have Insiders Sold DXP Enterprises Shares Recently?

Some DXP Enterprises, Inc. (NASDAQ:DXPE) shareholders may be a little concerned to see that the Senior VP & COO, Nicholas Little, recently sold a substantial US$2.4m worth of stock at a price of US$119 per share. However, that sale only accounted for 2.5% of their holding, so arguably it doesn't say much about their conviction.

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DXP Enterprises Insider Transactions Over The Last Year

In fact, the recent sale by Senior VP & COO Nicholas Little was not their only sale of DXP Enterprises shares this year. Earlier in the year, they fetched US$87.73 per share in a -US$4.0m sale. That means that an insider was selling shares at slightly below the current price (US$117). 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. 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 5.4% of Nicholas Little's holding.

Over the last year we saw more insider selling of DXP Enterprises shares, than buying. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

Check out our latest analysis for DXP Enterprises

I will like DXP Enterprises 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.

Does DXP Enterprises Boast High Insider Ownership?

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. I reckon it's a good sign if insiders own a significant number of shares in the company. DXP Enterprises insiders own about US$334m worth of shares (which is 18% of the company). I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Do The DXP Enterprises Insider Transactions Indicate?

Insiders sold stock recently, but they haven't been buying. And our longer term analysis of insider transactions didn't bring confidence, either. But it is good to see that DXP Enterprises is growing earnings. It is good to see high insider ownership, but the insider selling leaves us cautious. 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. Case in point: We've spotted 2 warning signs for DXP Enterprises you should be aware of, and 1 of these makes us a bit uncomfortable.

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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.