Have D.R. Horton Insiders Been Selling Stock?

Some D.R. Horton, Inc. (NYSE:DHI) shareholders may be a little concerned to see that the Executive Vice Chair, David Auld, recently sold a substantial US$3.9m worth of stock at a price of US$156 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 2.5%.

Check out our latest analysis for D.R. Horton

D.R. Horton Insider Transactions Over The Last Year

Notably, that recent sale by David Auld is the biggest insider sale of D.R. Horton shares that we've seen in the last year. That means that even when the share price was below the current price of US$162, an insider wanted to cash in some shares. When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent 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. It is worth noting that this sale was only 2.5% of David Auld's holding.

D.R. Horton insiders didn't buy any shares 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 are like me, then you will not want to miss this free list of growing companies that insiders are buying.

Insider Ownership

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. I reckon it's a good sign if insiders own a significant number of shares in the company. D.R. Horton insiders own 2.2% of the company, currently worth about US$1.2b based on the recent share price. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Does This Data Suggest About D.R. Horton Insiders?

An insider sold D.R. Horton shares recently, but they didn't buy any. And there weren't any purchases to give us comfort, over the last year. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. While conducting our analysis, we found that D.R. Horton has 1 warning sign and it would be unwise to ignore it.

But note: D.R. Horton 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 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.