For Concentrix Insiders, Selling US$5.3m Of Shares Was A Smart Move

While Concentrix Corporation (NASDAQ:CNXC) shareholders have had a good week with the stock up 11%, they shouldn't let their guards down. Even though stock prices were relatively low, insiders elected to sell US$5.3m worth of stock in the last year, which could indicate some expected downturn.

While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.

Our free stock report includes 4 warning signs investors should be aware of before investing in Concentrix. Read for free now.

Concentrix Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the Vice Chairperson of the Board, Olivier Duha, sold US$5.3m worth of shares at a price of US$50.08 per share. That means that an insider was selling shares at slightly below the current price (US$55.66). 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 just 7.1% of Olivier Duha's stake. The only individual insider seller over the last year was Olivier Duha.

Over the last year, we can see that insiders have bought 1.50k shares worth US$71k. But they sold 108.84k shares for US$5.3m. 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!

See our latest analysis for Concentrix

If you are like me, then you will not want to miss this free list of small cap stocks that are not only being bought by insiders but also have attractive valuations.

Concentrix Insiders Are Selling The Stock

There was substantially more insider selling, than buying, of Concentrix shares over the last three months. In total, Vice Chairperson of the Board Olivier Duha sold US$5.3m worth of shares in that time. Meanwhile President Christopher Caldwell bought US$46k worth. Since the selling really does outweigh the buying, we'd say that these transactions may suggest that some insiders feel the shares are not cheap.

Insider Ownership Of Concentrix

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. Concentrix insiders own about US$97m worth of shares. That equates to 2.8% of the company. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Do The Concentrix Insider Transactions Indicate?

The stark truth for Concentrix 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. While insiders do own shares, they don't own a heap, and they have been selling. So we'd only buy after careful consideration. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Concentrix. Case in point: We've spotted 4 warning signs for Concentrix you should be aware of, and 1 of them shouldn't be ignored.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.