Stock Analysis

This Insider Has Just Sold Shares In MSC Industrial Direct Co., Inc. (NYSE:MSM)

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NYSE:MSM
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Some MSC Industrial Direct Co., Inc. (NYSE:MSM) shareholders may be a little concerned to see that the President, Erik Gershwind, recently sold a substantial US$4.3m worth of stock at a price of US$85.18 per share. However, that sale only accounted for 7.2% of their holding, so arguably it doesn't say much about their conviction.

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MSC Industrial Direct Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when Non-Executive Chairman Mitchell Jacobson bought US$14m worth of shares at a price of US$72.25 per share. We do like to see buying, but this purchase was made at well below the current price of US$84.10. Because the shares were purchased at a lower price, this particular buy doesn't tell us much about how insiders feel about the current share price.

Mitchell Jacobson purchased 204.65k shares over the year. The average price per share was US$72.41. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

insider-trading-volume
NYSE:MSM Insider Trading Volume November 27th 2022

MSC Industrial Direct is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Does MSC Industrial Direct Boast High Insider Ownership?

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. We usually like to see fairly high levels of insider ownership. MSC Industrial Direct insiders own about US$815m worth of shares (which is 17% of the company). 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 MSC Industrial Direct Insiders?

An insider hasn't bought MSC Industrial Direct stock in the last three months, but there was some selling. In contrast, they appear keener if you look at the last twelve months. And insider ownership remains quite considerable. So the recent selling doesn't worry us. While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. For example - MSC Industrial Direct has 3 warning signs we think you should be aware of.

But note: MSC Industrial Direct may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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, but not derivative transactions.

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