Don't Ignore The Insider Selling In Linde

Some Linde plc (NASDAQ:LIN) shareholders may be a little concerned to see that the Lead Independent Director, Robert Wood, recently sold a substantial US$1.3m worth of stock at a price of US$456 per share. That sale reduced their total holding by 17% which is hardly insignificant, but far from the worst we've seen.

See our latest analysis for Linde

Linde Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by the insider, John Panikar, for US$4.6m worth of shares, at about US$463 per share. So what is clear is that an insider saw fit to sell at around the current price of US$461. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. In this case, the big sale took place at around the current price, so it's not too bad (but it's still not a positive).

In total, Linde 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. By clicking on the graph below, you can see the precise details of each insider transaction!

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Insider Ownership

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Linde insiders own about US$370m worth of shares (which is 0.2% 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 Linde Insiders?

The insider sales have outweighed the insider buying, at Linde, in the last three months. Despite some insider buying, the longer term picture doesn't make us feel much more positive. But since Linde is profitable and growing, we're not too worried by this. 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 Linde. While conducting our analysis, we found that Linde has 2 warning signs and it would be unwise to ignore them.

Of course Linde may not be the best stock to buy. So you may wish to see this free collection of high quality 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.