Don't Ignore The Insider Selling In Paymentus Holdings

We wouldn't blame Paymentus Holdings, Inc. (NYSE:PAY) shareholders if they were a little worried about the fact that Sanjay Kalra, the Senior VP recently netted about US$535k selling shares at an average price of US$34.20. That's a big disposal, and it decreased their holding size by 23%, which is notable but not too bad.

See our latest analysis for Paymentus Holdings

The Last 12 Months Of Insider Transactions At Paymentus Holdings

Notably, that recent sale by Senior VP Sanjay Kalra was not the only time they sold Paymentus Holdings shares this year. Earlier in the year, they fetched US$18.85 per share in a -US$1.2m sale. That means that even when the share price was below the current price of US$36.31, an insider wanted to cash in some shares. 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. This single sale was 55% of Sanjay Kalra's stake.

Insiders in Paymentus Holdings didn't buy any shares in 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!

I will like Paymentus 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.

Insider Ownership Of Paymentus Holdings

For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Paymentus Holdings insiders own 18% of the company, currently worth about US$830m based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Does This Data Suggest About Paymentus Holdings Insiders?

Insiders sold stock recently, but they haven't been buying. And there weren't any purchases to give us comfort, over the last year. But since Paymentus 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. 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. To assist with this, we've discovered 2 warning signs that you should run your eye over to get a better picture of Paymentus Holdings.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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.