Have CME Group Insiders Been Selling Stock?

Some CME Group Inc. (NASDAQ:CME) shareholders may be a little concerned to see that the Chief Information Officer, Sunil Cutinho, recently sold a substantial US$1.0m worth of stock at a price of US$227 per share. That sale reduced their total holding by 14% which is hardly insignificant, but far from the worst we've seen.

View our latest analysis for CME Group

CME Group Insider Transactions Over The Last Year

The Chairman & CEO, Terrence Duffy, made the biggest insider sale in the last 12 months. That single transaction was for US$8.4m worth of shares at a price of US$211 each. So it's clear an insider wanted to take some cash off the table, even below the current price of US$225. 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. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. It is worth noting that this sale was only 37% of Terrence Duffy's holding.

In total, CME Group insiders sold more than they bought over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

If you are like me, then you will not want to miss this free list of small cap stocks that are not only being bought by insiders but also have attractive valuations.

Insider Ownership Of CME Group

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. I reckon it's a good sign if insiders own a significant number of shares in the company. CME Group insiders own 0.3% of the company, currently worth about US$273m based on the recent share price. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

What Might The Insider Transactions At CME Group Tell Us?

The stark truth for CME Group is that there has been more insider selling than insider buying in the last three months. Despite some insider buying, the longer term picture doesn't make us feel much more positive. But since CME Group is profitable and growing, we're not too worried by this. 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. Every company has risks, and we've spotted 2 warning signs for CME Group you should know about.

But note: CME Group 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.