Chief Financial Officer Sonia Jain Sold A Bunch Of Shares In Cars.com

We wouldn't blame Cars.com Inc. (NYSE:CARS) shareholders if they were a little worried about the fact that Sonia Jain, the Chief Financial Officer recently netted about US$984k selling shares at an average price of US$19.68. That diminished their holding by a very significant 56%, which arguably implies a strong desire to reallocate capital.

See our latest analysis for Cars.com

The Last 12 Months Of Insider Transactions At Cars.com

Notably, that recent sale by Sonia Jain is the biggest insider sale of Cars.com shares that we've seen in the last year. So it's clear an insider wanted to take some cash off the table, even slightly below the current price of US$19.87. 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. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. It is worth noting that this sale was 56% of Sonia Jain's holding.

Insiders in Cars.com 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 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: Most of them are flying under the radar).

Insider Ownership

Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 1.5% of Cars.com shares, worth about US$19m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Does This Data Suggest About Cars.com Insiders?

Insiders sold Cars.com shares recently, but they didn't buy any. And even if we look at the last year, we didn't see any purchases. Insider ownership isn't particularly high, so this analysis makes us cautious about the company. We're in no rush to buy! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. For example, Cars.com has 4 warning signs (and 1 which is potentially serious) we think you should know about.

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.