Trade Alert: President Of Reliance Steel & Aluminum Karla Lewis Has Sold Stock

We wouldn't blame Reliance Steel & Aluminum Co. (NYSE:RS) shareholders if they were a little worried about the fact that Karla Lewis, the President recently netted about US$14m selling shares at an average price of US$319. That's a big disposal, and it decreased their holding size by 35%, which is notable but not too bad.

See our latest analysis for Reliance Steel & Aluminum

Reliance Steel & Aluminum Insider Transactions Over The Last Year

In fact, the recent sale by Karla Lewis was the biggest sale of Reliance Steel & Aluminum shares made by an insider individual in the last twelve months, according to our records. So it's clear an insider wanted to take some cash off the table, even slightly below the current price of US$324. 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. 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. We note that the biggest single sale was only 35%of Karla Lewis's holding.

Reliance Steel & Aluminum insiders didn't buy any shares over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

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Does Reliance Steel & Aluminum Boast High Insider Ownership?

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. A high insider ownership often makes company leadership more mindful of shareholder interests. Reliance Steel & Aluminum insiders own about US$120m worth of shares (which is 0.6% 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 Reliance Steel & Aluminum Insiders?

Insiders sold stock recently, but they haven't been buying. And even if we look at the last year, we didn't see any purchases. While insiders do own a lot of shares in the company (which is good), our analysis of their transactions doesn't make us feel confident about the company. While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. Case in point: We've spotted 2 warning signs for Reliance Steel & Aluminum you should be aware of, and 1 of these can't be ignored.

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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.