Don't Ignore The Insider Selling In Universal Insurance Holdings

We wouldn't blame Universal Insurance Holdings, Inc. (NYSE:UVE) shareholders if they were a little worried about the fact that Jon Springer, the Director recently netted about US$1.1m selling shares at an average price of US$31.41. That's a big disposal, and it decreased their holding size by 12%, which is notable but not too bad.

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The Last 12 Months Of Insider Transactions At Universal Insurance Holdings

In the last twelve months, the biggest single sale by an insider was when the Executive Chairman, Sean Downes, sold US$1.3m worth of shares at a price of US$26.91 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of US$30.82. 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 just 5.2% of Sean Downes's stake.

Insiders in Universal Insurance Holdings 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 want to know exactly who sold, for how much, and when, simply click on the graph below!

See our latest analysis for Universal Insurance Holdings

I will like Universal Insurance Holdings 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.

Insider Ownership

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. Insiders own 9.5% of Universal Insurance Holdings shares, worth about US$82m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

What Might The Insider Transactions At Universal Insurance Holdings Tell Us?

Insiders sold Universal Insurance Holdings shares recently, but they didn't buy any. Looking to the last twelve months, our data doesn't show any insider buying. But since Universal Insurance Holdings is profitable and growing, we're not too worried by this. While insiders do own shares, they don't own a heap, and they have been selling. We'd practice some caution before buying! So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. Our analysis shows 2 warning signs for Universal Insurance Holdings (1 shouldn't be ignored!) and we strongly recommend you look at these before investing.

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.