Insiders At Applied Industrial Technologies Sold US$24m In Stock, Alluding To Potential Weakness

Over the past year, many Applied Industrial Technologies, Inc. (NYSE:AIT) insiders sold a significant stake in the company which may have piqued investors' interest. 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, when multiple insiders sell stock over a specific duration, shareholders should take notice as that could possibly be a red flag.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

Check out our latest analysis for Applied Industrial Technologies

The Last 12 Months Of Insider Transactions At Applied Industrial Technologies

Over the last year, we can see that the biggest insider sale was by the President, Neil Schrimsher, for US$16m worth of shares, at about US$170 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of US$188. 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. We note that the biggest single sale was only 32% of Neil Schrimsher's holding.

Insiders in Applied Industrial Technologies didn't buy any shares in the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

I will like Applied Industrial Technologies 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.

Insiders At Applied Industrial Technologies Have Sold Stock Recently

The last quarter saw substantial insider selling of Applied Industrial Technologies shares. Specifically, insider Jason Vasquez ditched US$128k 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 Applied Industrial Technologies Boast High Insider Ownership?

Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Applied Industrial Technologies insiders own 1.4% of the company, currently worth about US$100m 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 Does This Data Suggest About Applied Industrial Technologies Insiders?

An insider sold stock recently, but they haven't been buying. And there weren't any purchases to give us comfort, over the last year. But it is good to see that Applied Industrial Technologies is growing earnings. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. Therefore, you should definitely take a look at this FREE report showing analyst forecasts for Applied Industrial Technologies.

Of course Applied Industrial Technologies 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 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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