Don't Ignore The Insider Selling In Arthur J. Gallagher

Some Arthur J. Gallagher & Co. (NYSE:AJG) shareholders may be a little concerned to see that the Corporate VP & CFO, Douglas Howell, recently sold a substantial US$2.9m worth of stock at a price of US$239 per share. That sale reduced their total holding by 11% which is hardly insignificant, but far from the worst we've seen.

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The Last 12 Months Of Insider Transactions At Arthur J. Gallagher

Over the last year, we can see that the biggest insider sale was by the insider, Susan Pietrucha, for US$5.2m worth of shares, at about US$212 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of US$239. When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. This single sale was 99% of Susan Pietrucha's stake.

Insiders in Arthur J. Gallagher didn't buy any shares in the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

I will like Arthur J. Gallagher better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

Insider Ownership

Many investors like to check how much of a company is owned by insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Arthur J. Gallagher insiders own about US$592m worth of shares (which is 1.1% 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 Does This Data Suggest About Arthur J. Gallagher Insiders?

Insiders sold Arthur J. Gallagher shares recently, but they didn't buy any. And even if we look at the last year, we didn't see any purchases. It is good to see high insider ownership, but the insider selling leaves us cautious. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Arthur J. Gallagher. For example - Arthur J. Gallagher has 4 warning signs we think 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 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.