Fresh Del Monte Produce Insiders Sold US$864k Of Shares Suggesting Hesitancy

Fresh Del Monte Produce Inc. (NYSE:FDP) shareholders might have a reason to worry after multiple insiders sold their shares over the last year. 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, when multiple insiders sell stock over a specific duration, shareholders should take notice as that could possibly be a red flag.

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 Fresh Del Monte Produce

Fresh Del Monte Produce Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when Director Amir Abu-Ghazaleh bought US$313k worth of shares at a price of US$23.63 per share. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of US$31.34. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.

Over the last year, we can see that insiders have bought 15.25k shares worth US$357k. But insiders sold 32.34k shares worth US$864k. In total, Fresh Del Monte Produce insiders sold more than they bought over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: Most of them are flying under the radar).

Insiders At Fresh Del Monte Produce Have Sold Stock Recently

The last three months saw significant insider selling at Fresh Del Monte Produce. Specifically, insiders ditched US$157k worth of shares in that time, and we didn't record any purchases whatsoever. Overall this makes us a bit cautious, but it's not the be all and end all.

Insider Ownership

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. Fresh Del Monte Produce insiders own about US$280m worth of shares (which is 18% of the company). I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Do The Fresh Del Monte Produce Insider Transactions Indicate?

Insiders sold Fresh Del Monte Produce shares recently, but they didn't buy any. Zooming out, the longer term picture doesn't give us much comfort. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Fresh Del Monte Produce. In terms of investment risks, we've identified 3 warning signs with Fresh Del Monte Produce and understanding these should be part of your investment process.

But note: Fresh Del Monte Produce may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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.