CarGurus Independent Director Greg Schwartz Sells 78% Of Holding

We'd be surprised if CarGurus, Inc. (NASDAQ:CARG) shareholders haven't noticed that the Independent Director, Greg Schwartz, recently sold US$311k worth of stock at US$28.29 per share. Equally important, that sale actually reduced their holding by a full 78% which hardly makes us feel bullish about the stock.

See our latest analysis for CarGurus

CarGurus Insider Transactions Over The Last Year

In fact, the recent sale by Greg Schwartz was the biggest sale of CarGurus shares made by an insider individual in the last twelve months, according to our records. That means that even when the share price was below the current price of US$28.98, an insider wanted to cash in some shares. We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. 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 78% of Greg Schwartz's holding.

Greg Schwartz divested 23.50k shares over the last 12 months at an average price of US$26.03. 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 Of CarGurus

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. CarGurus insiders own 17% of the company, currently worth about US$519m based on the recent share price. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

What Might The Insider Transactions At CarGurus Tell Us?

An insider sold stock recently, but they haven't been buying. Looking to the last twelve months, our data doesn't show any insider buying. It is good to see high insider ownership, but the insider selling leaves us cautious. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. In terms of investment risks, we've identified 1 warning sign with CarGurus and understanding this should be part of your investment process.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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.