Celsius Holdings, Inc. (NASDAQ:CELH) insiders may have anticipated weakness, ditched US$216m worth of stock even though prices were low

By
Simply Wall St
Published
December 01, 2021
NasdaqCM:CELH
Source: Shutterstock

Celsius Holdings, Inc.'s (NASDAQ:CELH) stock price has dropped 14% in the previous week, but insiders who sold US$216m in stock over the past year have had less luck. Insiders would probably have been better off holding on to their shares given that the average selling price of US$62.50 is still lower than the current share price.

Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.

Check out our latest analysis for Celsius Holdings

Celsius Holdings Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by the insider, Carl DeSantis, for US$183m worth of shares, at about US$62.50 per share. That means that even when the share price was slightly below the current price of US$62.91, 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 just 13% of Carl DeSantis's stake.

Insiders in Celsius Holdings didn't buy any shares in the last year. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

insider-trading-volume
NasdaqCM:CELH Insider Trading Volume December 2nd 2021

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

Insider Ownership of Celsius Holdings

Many investors like to check how much of a company is owned by insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Celsius Holdings insiders own about US$1.8b worth of shares (which is 35% of the company). Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

What Might The Insider Transactions At Celsius Holdings Tell Us?

There haven't been any insider transactions in the last three months -- that doesn't mean much. It's great to see high levels of insider ownership, but looking back over the last year, we don't gain confidence from the Celsius Holdings insiders selling. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Celsius Holdings. For instance, we've identified 3 warning signs for Celsius Holdings (1 makes us a bit uncomfortable) you should be aware of.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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, but not derivative transactions.

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