Don't Ignore The Insider Selling In Sweetgreen

We wouldn't blame Sweetgreen, Inc. (NYSE:SG) shareholders if they were a little worried about the fact that Bradley Singer, the Independent Director recently netted about US$1.9m selling shares at an average price of US$32.30. That sale reduced their total holding by 25% which is hardly insignificant, but far from the worst we've seen.

Check out our latest analysis for Sweetgreen

Sweetgreen Insider Transactions Over The Last Year

In fact, the recent sale by Bradley Singer was the biggest sale of Sweetgreen shares made by an insider individual in the last twelve months, according to our records. So what is clear is that an insider saw fit to sell at around the current price of US$31.92. While insider selling is a negative, to us, it is more negative if the shares are sold 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.

Insiders in Sweetgreen didn't buy any shares in the last year. 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!

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Insider Ownership Of Sweetgreen

For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. It's great to see that Sweetgreen insiders own 13% of the company, worth about US$486m. 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 Do The Sweetgreen Insider Transactions Indicate?

Insiders sold Sweetgreen shares recently, but they didn't buy any. And there weren't any purchases to give us comfort, over the last year. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. In terms of investment risks, we've identified 2 warning signs with Sweetgreen and understanding these should be part of your investment process.

Of course Sweetgreen 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.