This Graham Holdings Insider Reduced Their Stake By 22%

From what we can see, insiders were net sellers in Graham Holdings Company's (NYSE:GHC ) during the past 12 months. That is, insiders sold the stock in greater numbers than they purchased it.

Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.

Check out our latest analysis for Graham Holdings

Graham Holdings Insider Transactions Over The Last Year

The Independent Director, Katharine Weymouth, made the biggest insider sale in the last 12 months. That single transaction was for US$396k worth of shares at a price of US$713 each. So it's clear an insider wanted to take some cash off the table, even below the current price of US$919. 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. It is worth noting that this sale was only 22% of Katharine Weymouth's holding. Katharine Weymouth was the only individual insider to sell shares in the last twelve months.

Over the last year, we can see that insiders have bought 235.00 shares worth US$175k. But insiders sold 934.00 shares worth US$755k. Katharine Weymouth divested 934.00 shares over the last 12 months at an average price of US$809. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

I will like Graham Holdings better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.

Insiders At Graham Holdings Have Sold Stock Recently

The last three months saw significant insider selling at Graham Holdings. Specifically, Independent Director Katharine Weymouth ditched US$359k worth of shares in that time, and we didn't record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.

Insider Ownership Of Graham Holdings

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. We usually like to see fairly high levels of insider ownership. Graham Holdings insiders own about US$877m worth of shares (which is 22% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Does This Data Suggest About Graham Holdings Insiders?

An insider sold stock recently, but they haven't been buying. Zooming out, the longer term picture doesn't give us much comfort. But since Graham Holdings is profitable and growing, we're not too worried by this. It is good to see high insider ownership, but the insider selling leaves us cautious. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For instance, we've identified 3 warning signs for Graham Holdings (1 shouldn't be ignored) you should be aware of.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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.