Trade Alert: Chief Operating Officer Of Chipotle Mexican Grill Scott Boatwright Has Sold Stock

Some Chipotle Mexican Grill, Inc. (NYSE:CMG) shareholders may be a little concerned to see that the Chief Operating Officer, Scott Boatwright, recently sold a substantial US$3.0m worth of stock at a price of US$2,317 per share. Probably the most concerning element of the whole transaction is that the disposal amounted to 53% of their entire holding.

Check out our latest analysis for Chipotle Mexican Grill

Chipotle Mexican Grill Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by the Chief Customer & Technology Officer, Curtis Garner, for US$10.0m worth of shares, at about US$2,060 per share. That means that an insider was selling shares at slightly below the current price (US$2,271). 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. However, while insider selling is sometimes discouraging, it's only a weak signal. It is worth noting that this sale was only 48% of Curtis Garner's holding.

All up, insiders sold more shares in Chipotle Mexican Grill than they bought, over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: insiders have been buying them).

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. It's great to see that Chipotle Mexican Grill insiders own 0.7% of the company, worth about US$411m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Does This Data Suggest About Chipotle Mexican Grill Insiders?

The insider sales have outweighed the insider buying, at Chipotle Mexican Grill, in the last three months. Zooming out, the longer term picture doesn't give us much comfort. On the plus side, Chipotle Mexican Grill makes money, and is growing profits. It is good to see high insider ownership, but the insider selling leaves us cautious. 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. Case in point: We've spotted 1 warning sign for Chipotle Mexican Grill you should be aware of.

But note: Chipotle Mexican Grill 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.