Some The Sherwin-Williams Company (NYSE:SHW) shareholders may be a little concerned to see that the President & COO, David Sewell, recently sold a whopping US$2.0m worth of stock at a price of US$572 per share. That sale reduced their total holding by 37% which is hardly insignificant, but far from the worst we’ve seen.
Sherwin-Williams Insider Transactions Over The Last Year
In fact, the recent sale by David Sewell was the biggest sale of Sherwin-Williams shares made by an insider individual in the last twelve months, according to our records. That means that even when the share price was slightly below the current price of US$583, an insider wanted to cash in some shares. 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. It is worth noting that this sale was only 37% of David Sewell’s holding.
Insiders in Sherwin-Williams didn’t buy any shares in the last year. You can see the insider transactions (by 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!
If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: insiders have been buying them).
Does Sherwin-Williams Boast High Insider Ownership?
For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it’s a good sign if insiders own a significant number of shares in the company. Sherwin-Williams insiders own about US$153m worth of shares (which is 0.3% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.
So What Does This Data Suggest About Sherwin-Williams Insiders?
Insiders sold Sherwin-Williams shares recently, but they didn’t buy any. Looking to the last twelve months, our data doesn’t show any insider buying. But since Sherwin-Williams is profitable and growing, we’re not too worried by this. It is good to see high insider ownership, but the insider selling leaves us cautious. 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. To assist with this, we’ve discovered 2 warning signs that you should run your eye over to get a better picture of Sherwin-Williams.
Of course Sherwin-Williams 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, but not derivative transactions.
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This article by Simply Wall St is general in nature. 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. Thank you for reading.