Trade Alert: President Of Portillo's Michael Osanloo Has Sold Stock

Some Portillo's Inc. (NASDAQ:PTLO) shareholders may be a little concerned to see that the President, Michael Osanloo, recently sold a substantial US$680k worth of stock at a price of US$10.29 per share. That sale reduced their total holding by 46% which is hardly insignificant, but far from the worst we've seen.

View our latest analysis for Portillo's

The Last 12 Months Of Insider Transactions At Portillo's

In fact, the recent sale by Michael Osanloo was the biggest sale of Portillo's shares made by an insider individual in the last twelve months, according to our records. So it's clear an insider wanted to take some cash off the table, even below the current price of US$11.86. 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. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. This single sale was just 46% of Michael Osanloo's stake.

The chart below shows insider transactions (by companies and individuals) over the last year. 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).

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. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Portillo's insiders own about US$25m worth of shares. That equates to 3.1% 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 Do The Portillo's Insider Transactions Indicate?

An insider hasn't bought Portillo's stock in the last three months, but there was some selling. And there weren't any purchases to give us comfort, over the last year. But it is good to see that Portillo's is growing earnings. While insiders do own shares, they don't own a heap, and they have been selling. We're in no rush to buy! 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 Portillo's (1 is a bit unpleasant) you should be aware of.

But note: Portillo's 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.