Possible Bearish Signals With CBRE Group Insiders Disposing Stock

In the last year, many CBRE Group, Inc. (NYSE:CBRE) insiders sold a substantial stake in the company which may have sparked shareholders' attention. When analyzing insider transactions, it is usually more valuable to know whether insiders are buying versus knowing if they are selling, as the latter sends an ambiguous message. However, when multiple insiders sell stock over a specific duration, shareholders should take notice as that could possibly be a red flag.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

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CBRE Group Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by the Chief Executive Officer of Trammell Crow Co, Daniel Queenan, for US$1.4m worth of shares, at about US$140 per share. So it's clear an insider wanted to take some cash off the table, even slightly below the current price of US$142. 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 4.6% of Daniel Queenan's holding.

All up, insiders sold more shares in CBRE Group than they bought, over the last year. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. 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 CBRE Group

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CBRE Group Insiders Are Selling The Stock

Over the last three months, we've seen significant insider selling at CBRE Group. In total, insiders sold US$814k worth of shares in that time, and we didn't record any purchases whatsoever. In light of this it's hard to argue that all the insiders think that the shares are a bargain.

Insider Ownership

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. It's great to see that CBRE Group insiders own 0.6% of the company, worth about US$254m. 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 CBRE Group Insiders?

Insiders haven't bought CBRE Group stock in the last three months, but there was some selling. And our longer term analysis of insider transactions didn't bring confidence, either. But it is good to see that CBRE Group is growing earnings. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. At Simply Wall St, we found 1 warning sign for CBRE Group that deserve your attention before buying any shares.

But note: CBRE Group may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.

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.