Several MasterBrand Insiders Sell Shares Sending Potential Negative Signal

A number of MasterBrand, Inc. (NYSE:MBC) insiders sold their shares in the last year, which may have raised concerns among investors. 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 insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

View our latest analysis for MasterBrand

MasterBrand Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when Independent Director Robert Crisci bought US$308k worth of shares at a price of US$15.39 per share. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of US$17.97. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

All up, insiders sold more shares in MasterBrand than they bought, over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

I will like MasterBrand 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 MasterBrand Have Sold Stock Recently

There was substantially more insider selling, than buying, of MasterBrand shares over the last three months. We note insiders cashed in US$366k worth of shares. On the flip side, Independent Director Robert Crisci spent US$308k on purchasing shares (as mentioned above) . Generally this level of net selling might be considered a bit bearish.

Does MasterBrand Boast High Insider Ownership?

For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. It appears that MasterBrand insiders own 1.3% of the company, worth about US$30m. 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 Do The MasterBrand Insider Transactions Indicate?

The stark truth for MasterBrand is that there has been more insider selling than insider buying in the last three months. Zooming out, the longer term picture doesn't give us much comfort. But since MasterBrand is profitable and growing, we're not too worried by this. Insider ownership isn't particularly high, so this analysis makes us cautious about the company. We're in no rush to buy! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing MasterBrand. To assist with this, we've discovered 1 warning sign that you should run your eye over to get a better picture of MasterBrand.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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.