Pilgrim's Pride Insiders Sold US$4.8m Of Shares Suggesting Hesitancy

The fact that multiple Pilgrim's Pride Corporation (NASDAQ:PPC) insiders offloaded a considerable amount of shares over the past year could have raised some eyebrows amongst investors. 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.

While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.

See our latest analysis for Pilgrim's Pride

Pilgrim's Pride Insider Transactions Over The Last Year

The President & CEO, Fabio Sandri, made the biggest insider sale in the last 12 months. That single transaction was for US$2.9m worth of shares at a price of US$44.50 each. That means that even when the share price was below the current price of US$53.38, an insider wanted to cash in some shares. 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. We note that the biggest single sale was 71% of Fabio Sandri's holding.

In the last year Pilgrim's Pride insiders didn't buy any company stock. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

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Insiders At Pilgrim's Pride Have Sold Stock Recently

Over the last three months, we've seen significant insider selling at Pilgrim's Pride. In total, VP, CFO & Chief Accounting Officer Matthew Galvanoni sold US$287k 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 Pilgrim's Pride Boast High Insider Ownership?

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. Insiders own 0.05% of Pilgrim's Pride shares, worth about US$6.8m, according to our data. We do generally prefer see higher levels of insider ownership.

So What Does This Data Suggest About Pilgrim's Pride Insiders?

An insider sold Pilgrim's Pride shares recently, but they didn't buy any. And there weren't any purchases to give us comfort, over the last year. But since Pilgrim's Pride is profitable and growing, we're not too worried by this. Insiders own relatively few shares in the company, and when you consider the sales, we're not particularly excited about the stock. So we're not rushing to buy, to say the least. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For example - Pilgrim's Pride has 1 warning sign we think you should be aware of.

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.