PulteGroup, Inc. (NYSE:PHM) stock was sold by a number of insiders in the recent year, which isn't a positive indicator for investors

By
Simply Wall St
Published
November 24, 2021
NYSE:PHM
Source: Shutterstock

PulteGroup, Inc. (NYSE:PHM) shareholders may have reason to be concerned, as several insiders sold their shares over the past year. When analyzing insider transactions, it is usually more valuable to know whether insiders are buying versus knowing if they are selling, as the latter sends an ambiguous message. However, shareholders should take a deeper look if several insiders are selling stock over a specific time period.

While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

See our latest analysis for PulteGroup

PulteGroup Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the Executive VP & COO, John Chadwick, sold US$395k worth of shares at a price of US$46.32 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of US$52.90. 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. We note that the biggest single sale was only 9.8% of John Chadwick's holding.

PulteGroup insiders didn't buy any shares over the last year. 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!

insider-trading-volume
NYSE:PHM Insider Trading Volume November 24th 2021

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

Insider Ownership

For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 0.6% of PulteGroup shares, worth about US$77m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Do The PulteGroup Insider Transactions Indicate?

There haven't been any insider transactions in the last three months -- that doesn't mean much. Our analysis of PulteGroup insider transactions leaves us cautious. The modest level of insider ownership is, at least, some comfort. Therefore, you should definitely take a look at this FREE report showing analyst forecasts for PulteGroup.

But note: PulteGroup 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.

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.

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