Don't Ignore The Insider Selling In Cricut

Anyone interested in Cricut, Inc. (NASDAQ:CRCT) should probably be aware that the Executive VP of General Counsel & Human Resources and Corporate Secretary, Donald Olsen, recently divested US$157k worth of shares in the company, at an average price of US$5.23 each. On the bright side, that sale was only 7.4% of their holding, so we doubt it's very meaningful, on its own.

Check out our latest analysis for Cricut

The Last 12 Months Of Insider Transactions At Cricut

The CEO, President & Director, Ashish Arora, made the biggest insider sale in the last 12 months. That single transaction was for US$1.9m worth of shares at a price of US$7.48 each. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. The silver lining is that this sell-down took place above the latest price (US$5.16). So it may not tell us anything about how insiders feel about the current share price.

In total, Cricut insiders sold more than they bought over the last year. 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!

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: Most of them are flying under the radar).

Does Cricut Boast High Insider Ownership?

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. Cricut insiders own 18% of the company, currently worth about US$201m based on the recent share price. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Does This Data Suggest About Cricut Insiders?

An insider hasn't bought Cricut stock in the last three months, but there was some selling. Zooming out, the longer term picture doesn't give us much comfort. On the plus side, Cricut makes money, and is growing profits. It is good to see high insider ownership, but the insider selling leaves us cautious. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. For instance, we've identified 2 warning signs for Cricut (1 makes us a bit uncomfortable) you should be aware of.

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.

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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.