Insiders At Ferguson Enterprises Sold US$5.0m In Stock, Alluding To Potential Weakness

In the last year, many Ferguson Enterprises Inc. (NYSE:FERG) insiders sold a substantial stake in the company which may have sparked shareholders' attention. Knowing whether insiders are buying is usually more helpful when evaluating insider transactions, as insider selling can have various explanations. 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, logic dictates you should pay some attention to whether insiders are buying or selling shares.

See our latest analysis for Ferguson Enterprises

Ferguson Enterprises Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by the CEO, President & Director, Kevin Murphy, for US$2.0m worth of shares, at about US$201 per share. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. The good news is that this large sale was at well above current price of US$168. So it is hard to draw any strong conclusion from it.

Over the last year, we can see that insiders have bought 3.19k shares worth US$611k. But insiders sold 25.30k shares worth US$5.0m. In total, Ferguson Enterprises insiders sold more than they bought over the last year. 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!

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: Most of them are flying under the radar).

Insiders At Ferguson Enterprises Have Bought Stock Recently

There has been significantly more insider buying, than selling, at Ferguson Enterprises, over the last three months. In total, two insiders bought US$611k worth of shares in that time. But Chief Marketing Officer Victoria Morrissey sold shares worth US$354k. We think insiders may be optimistic about the future, since insiders have been net buyers of shares.

Does Ferguson 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. A high insider ownership often makes company leadership more mindful of shareholder interests. It appears that Ferguson Enterprises insiders own 0.1% of the company, worth about US$42m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

What Might The Insider Transactions At Ferguson Enterprises Tell Us?

The recent insider purchases are heartening. On the other hand the transaction history, over the last year, isn't so positive. The more recent transactions are a positive, but Ferguson Enterprises insiders haven't shown the sustained enthusiasm that we look for, although they do own a decent number of shares, overall. So they seem pretty well aligned, overall. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Case in point: We've spotted 2 warning signs for Ferguson Enterprises you should be aware of.

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.