Insiders At Real Brokerage Sold US$13m In Stock, Alluding To Potential Weakness

In the last year, many The Real Brokerage Inc. (NASDAQ:REAX) insiders sold a substantial stake in the company which may have sparked shareholders' attention. When evaluating insider transactions, knowing whether insiders are buying is usually more beneficial than knowing whether they are selling, as the latter can be open to many interpretations. However, when multiple insiders sell stock over a specific duration, shareholders should take notice as that could possibly be a red flag.

While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.

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The Last 12 Months Of Insider Transactions At Real Brokerage

Over the last year, we can see that the biggest insider sale was by the Co-Founder, Tamir Poleg, for US$1.5m worth of shares, at about US$5.40 per share. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. The silver lining is that this sell-down took place above the latest price (US$3.69). So it is hard to draw any strong conclusion from it.

Happily, we note that in the last year insiders paid US$20k for 5.00k shares. But insiders sold 2.83m shares worth US$13m. In total, Real Brokerage insiders sold more than they bought over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

Check out our latest analysis for Real Brokerage

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Insiders At Real Brokerage Have Sold Stock Recently

Over the last three months, we've seen notably more insider selling, than insider buying, at Real Brokerage. In total, insiders sold US$3.9m worth of shares in that time. On the flip side, insiders spent US$20k on purchasing shares (as mentioned above) . Since the selling really does outweigh the buying, we'd say that these transactions may suggest that some insiders feel the shares are not cheap.

Does Real Brokerage Boast High Insider Ownership?

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. It appears that Real Brokerage insiders own 6.9% of the company, worth about US$56m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Does This Data Suggest About Real Brokerage Insiders?

The insider sales have outweighed the insider buying, at Real Brokerage, in the last three months. Despite some insider buying, the longer term picture doesn't make us feel much more positive. Insiders own shares, but we're still pretty cautious, given the history of sales. We'd practice some caution before buying! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Case in point: We've spotted 1 warning sign for Real Brokerage you should be aware of.

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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.