Have Insperity Insiders Been Selling Stock?

Some Insperity, Inc. (NYSE:NSP) shareholders may be a little concerned to see that the Co-Founder, Paul Sarvadi, recently sold a substantial US$2.1m worth of stock at a price of US$84.32 per share. However, it's crucial to note that they remain very much invested in the stock and that sale only reduced their holding by 2.0%.

Check out our latest analysis for Insperity

The Last 12 Months Of Insider Transactions At Insperity

In fact, the recent sale by Co-Founder Paul Sarvadi was not their only sale of Insperity shares this year. They previously made an even bigger sale of -US$2.6m worth of shares at a price of US$81.60 per share. That means that an insider was selling shares at slightly below the current price (US$87.69). We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. However, while insider selling is sometimes discouraging, it's only a weak signal. It is worth noting that this sale was only 2.4% of Paul Sarvadi's holding.

Over the last year we saw more insider selling of Insperity shares, than buying. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

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Insider Ownership Of Insperity

Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. It's great to see that Insperity insiders own 5.1% of the company, worth about US$163m. 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 Do The Insperity Insider Transactions Indicate?

The stark truth for Insperity 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. It is good to see high insider ownership, but the insider selling leaves us cautious. While it's good to be aware of 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. While conducting our analysis, we found that Insperity has 3 warning signs and it would be unwise to ignore them.

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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.