PJT Partners Insiders Sold US$9.0m Of Shares Suggesting Hesitancy

In the last year, many PJT Partners Inc. (NYSE:PJT) insiders sold a substantial stake in the company which may have sparked shareholders' attention. When evaluating insider transactions, knowing whether insiders are buying is usually more beneficial than knowing whether they are selling, as the latter can be open to many interpretations. However, if numerous insiders are selling, shareholders should investigate more.

Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.

See our latest analysis for PJT Partners

The Last 12 Months Of Insider Transactions At PJT Partners

The Non-Independent Director, K. Cornwell, made the biggest insider sale in the last 12 months. That single transaction was for US$1.9m worth of shares at a price of US$124 each. So it's clear an insider wanted to take some cash off the table, even below the current price of US$135. As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. However, while insider selling is sometimes discouraging, it's only a weak signal. This single sale was 87% of K. Cornwell's stake.

PJT Partners insiders didn't buy any shares over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

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Insiders At PJT Partners Have Sold Stock Recently

The last three months saw significant insider selling at PJT Partners. Specifically, insiders ditched US$3.6m worth of shares in that time, and we didn't record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.

Does PJT Partners Boast High Insider Ownership?

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. It's great to see that PJT Partners insiders own 4.5% of the company, worth about US$251m. 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 PJT Partners Insider Transactions Indicate?

Insiders sold PJT Partners shares recently, but they didn't buy any. And even if we look at the last year, we didn't see any purchases. But since PJT Partners 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. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing PJT Partners. In terms of investment risks, we've identified 2 warning signs with PJT Partners and understanding them should be part of your investment process.

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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.