Don't Ignore The Fact That This Insider Just Sold Some Shares In MarketAxess Holdings Inc. (NASDAQ:MKTX)

By
Simply Wall St
Published
November 06, 2020

We wouldn't blame MarketAxess Holdings Inc. (NASDAQ:MKTX) shareholders if they were a little worried about the fact that Kevin McPherson, the Global Head of Sales recently netted about US$2.2m selling shares at an average price of US$559. However, that sale only accounted for 5.1% of their holding, so arguably it doesn't say much about their conviction.

Check out our latest analysis for MarketAxess Holdings

The Last 12 Months Of Insider Transactions At MarketAxess Holdings

Notably, that recent sale by Kevin McPherson is the biggest insider sale of MarketAxess Holdings shares that we've seen in the last year. That means that even when the share price was slightly below the current price of US$581, an insider wanted to cash in some shares. 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. We note that the biggest single sale was only 5.1%of Kevin McPherson's holding.

In the last year MarketAxess Holdings insiders didn't buy any company stock. 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!

NasdaqGS:MKTX Insider Trading Volume November 6th 2020

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

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. MarketAxess Holdings insiders own about US$710m worth of shares (which is 3.2% 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.

What Might The Insider Transactions At MarketAxess Holdings Tell Us?

Insiders haven't bought MarketAxess Holdings stock in the last three months, but there was some selling. And there weren't any purchases to give us comfort, over the last year. But it is good to see that MarketAxess Holdings is growing earnings. 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 1 warning sign with MarketAxess Holdings and understanding it should be part of your investment process.

Of course MarketAxess Holdings 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, but not derivative transactions.

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This article by Simply Wall St is general in nature. 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.
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