Trade Alert: Independent Non-Executive Chairman Of Sprouts Farmers Market Joseph Fortunato Has Sold Stock

Some Sprouts Farmers Market, Inc. (NASDAQ:SFM) shareholders may be a little concerned to see that the Independent Non-Executive Chairman, Joseph Fortunato, recently sold a substantial US$1.5m worth of stock at a price of US$148 per share. That sale reduced their total holding by 38% which is hardly insignificant, but far from the worst we've seen.

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Sprouts Farmers Market Insider Transactions Over The Last Year

The CEO & Director, Jack Sinclair, made the biggest insider sale in the last 12 months. That single transaction was for US$6.9m worth of shares at a price of US$137 each. So it's clear an insider wanted to take some cash off the table, even below the current price of US$146. 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. We note that the biggest single sale was only 24% of Jack Sinclair's holding.

Insiders in Sprouts Farmers Market didn't buy any shares in 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!

View our latest analysis for Sprouts Farmers Market

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Does Sprouts Farmers Market Boast High Insider Ownership?

For a common shareholder, it is worth checking how many shares are held by company insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Sprouts Farmers Market insiders own about US$62m worth of shares. That equates to 0.4% of the company. 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 Does This Data Suggest About Sprouts Farmers Market Insiders?

Insiders sold stock recently, but they haven't been buying. And there weren't any purchases to give us comfort, over the last year. But since Sprouts Farmers Market is profitable and growing, we're not too worried by this. While insiders do own shares, they don't own a heap, and they have been selling. We're in no rush to buy! 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. To assist with this, we've discovered 1 warning sign that you should run your eye over to get a better picture of Sprouts Farmers Market.

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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.