Select Water Solutions Insiders Sell US$529k Of Stock, Possibly Signalling Caution

A number of Select Water Solutions, Inc. (NYSE:WTTR) insiders sold their shares in the last year, which may have raised concerns among investors. Knowing whether insiders are buying is usually more helpful when evaluating insider transactions, as insider selling can have various explanations. 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.

Check out our latest analysis for Select Water Solutions

The Last 12 Months Of Insider Transactions At Select Water Solutions

Over the last year, we can see that the biggest insider sale was by the Executive VP & CFO, Christopher George, for US$199k worth of shares, at about US$8.63 per share. That means that even when the share price was below the current price of US$14.46, 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. However, while insider selling is sometimes discouraging, it's only a weak signal. We note that the biggest single sale was only 8.3% of Christopher George's holding.

Insiders in Select Water Solutions didn't buy any shares in 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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Insider Ownership Of Select Water Solutions

For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. It appears that Select Water Solutions insiders own 4.2% of the company, worth about US$63m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

What Might The Insider Transactions At Select Water Solutions Tell Us?

The fact that there have been no Select Water Solutions insider transactions recently certainly doesn't bother us. Still, the insider transactions at Select Water Solutions in the last 12 months are not very heartening. But it's good to see that insiders own shares in the company. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Select Water Solutions. For example - Select Water Solutions has 1 warning sign we think you should be aware of.

Of course Select Water Solutions 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.