Jack in the Box Insiders Sold US$1.9m Of Shares Suggesting Hesitancy

In the last year, many Jack in the Box Inc. (NASDAQ:JACK) insiders sold a substantial stake in the company which may have sparked shareholders' attention. 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, when multiple insiders sell stock over a specific duration, shareholders should take notice as that could possibly be a red flag.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

See our latest analysis for Jack in the Box

The Last 12 Months Of Insider Transactions At Jack in the Box

Over the last year, we can see that the biggest insider sale was by the CEO & Director, Darin Harris, for US$558k worth of shares, at about US$68.01 per share. 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$50.17). So it may not shed much light on insider confidence at current levels.

In the last year Jack in the Box insiders didn't buy any company stock. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart 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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Are Jack in the Box Insiders Buying Or Selling?

We have seen a bit of insider selling at Jack in the Box, over the last three months. Senior VP & Chief People Officer Steven Piano only netted US$7.9k selling shares, in that period. Neither the lack of buying nor the presence of selling is heartening. But the volume sold is so low that it really doesn't bother us.

Insider Ownership Of Jack in the Box

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. Our data indicates that Jack in the Box insiders own about US$5.5m worth of shares (which is 0.6% of the company). Overall, this level of ownership isn't that impressive, but it's certainly better than nothing!

So What Do The Jack in the Box Insider Transactions Indicate?

We did not see any insider buying in the last three months, but we did see selling. But given the selling was modest, we're not worried. We're a little cautious about the insider selling at Jack in the Box. And we're not picking up on high enough insider ownership to give us any comfort. 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. Every company has risks, and we've spotted 2 warning signs for Jack in the Box (of which 1 is a bit concerning!) you should know about.

Of course Jack in the Box may not be the best stock to buy. So you may wish to see this free collection of high quality companies.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com