Some Johnson Controls International plc (NYSE:JCI) shareholders may be a little concerned to see that insider Tomas Brannemo recently sold a substantial US$617k worth of stock at a price of US$41.97 per share. That sale reduced their total holding by 26% which is hardly insignificant, but far from the worst we've seen.
Johnson Controls International Insider Transactions Over The Last Year
In the last twelve months, the biggest single sale by an insider was when the Vice Chairman, Brian Stief, sold US$2.4m worth of shares at a price of US$38.54 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of US$43.74. 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. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. This single sale was 63% of Brian Stief's stake.
Insiders in Johnson Controls International 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!
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Insider Ownership of Johnson Controls International
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Johnson Controls International insiders own about US$78m worth of shares. That equates to 0.2% of the company. 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 Johnson Controls International Insiders?
Insiders haven't bought Johnson Controls International stock in the last three months, but there was some selling. And even if we look at the last year, we didn't see any purchases. Insider ownership isn't particularly high, so this analysis makes us cautious about the company. We're in no rush to buy! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Every company has risks, and we've spotted 4 warning signs for Johnson Controls International you should know about.
Of course Johnson Controls International 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, but not derivative transactions.
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