Don't Ignore The Insider Selling In Royal Caribbean Cruises

Some Royal Caribbean Cruises Ltd. (NYSE:RCL) shareholders may be a little concerned to see that the Chairman, Richard Fain, recently sold a substantial US$9.2m worth of stock at a price of US$209 per share. However, it's crucial to note that they remain very much invested in the stock and that sale only reduced their holding by 8.2%.

View our latest analysis for Royal Caribbean Cruises

The Last 12 Months Of Insider Transactions At Royal Caribbean Cruises

Notably, that recent sale by Richard Fain is the biggest insider sale of Royal Caribbean Cruises shares that we've seen in the last year. So we know that an insider sold shares at around the present share price of US$202. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. We note that this sale took place at around the current price, so it isn't a major concern, though it's hardly a good sign.

Over the last year we saw more insider selling of Royal Caribbean Cruises shares, than buying. 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!

I will like Royal Caribbean Cruises 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.

Insider Ownership Of Royal Caribbean Cruises

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. We usually like to see fairly high levels of insider ownership. Royal Caribbean Cruises insiders own about US$206m worth of shares (which is 0.4% 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 Royal Caribbean Cruises Insiders?

Insiders haven't bought Royal Caribbean Cruises stock in the last three months, but there was some selling. Zooming out, the longer term picture doesn't give us much comfort. But it is good to see that Royal Caribbean Cruises is growing earnings. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. 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. For example, Royal Caribbean Cruises has 3 warning signs (and 1 which is potentially serious) we think you should know about.

But note: Royal Caribbean Cruises 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.