Insiders At Monster Beverage Sold US$48m In Stock, Alluding To Potential Weakness

In the last year, many Monster Beverage Corporation (NASDAQ:MNST) insiders sold a substantial stake in the company which may have sparked shareholders' attention. When analyzing insider transactions, it is usually more valuable to know whether insiders are buying versus knowing if they are selling, as the latter sends an ambiguous message. However, if numerous insiders are selling, shareholders should investigate more.

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 Monster Beverage

The Last 12 Months Of Insider Transactions At Monster Beverage

In the last twelve months, the biggest single sale by an insider was when the Director, Mark Hall, sold US$15m worth of shares at a price of US$58.55 per share. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. It's of some comfort that this sale was conducted at a price well above the current share price, which is US$49.74. So it may not shed much light on insider confidence at current levels.

In the last twelve months insiders purchased 120.82k shares for US$6.4m. But they sold 881.81k shares for US$48m. All up, insiders sold more shares in Monster Beverage than they bought, over the last year. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

I will like Monster Beverage 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.

Monster Beverage Insiders Are Selling The Stock

The last three months saw significant insider selling at Monster Beverage. In total, Lead Independent Director Mark Vidergauz dumped US$562k 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.

Insider Ownership

Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. Monster Beverage insiders own 0.4% of the company, currently worth about US$174m 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 Monster Beverage Insiders?

An insider sold Monster Beverage shares recently, but they didn't buy any. Zooming out, the longer term picture doesn't give us much comfort. On the plus side, Monster Beverage makes money, and is growing profits. It is good to see high insider ownership, but the insider selling leaves us cautious. Of course, the future is what matters most. So if you are interested in Monster Beverage, you should check out this free report on analyst forecasts for the company.

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 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.