Camden Property Trust (NYSE:CPT) insiders sold US$40m worth of stock suggesting impending weakness.

By
Simply Wall St
Published
February 21, 2022
NYSE:CPT
Source: Shutterstock

The fact that multiple Camden Property Trust (NYSE:CPT) insiders offloaded a considerable amount of shares over the past year could have raised some eyebrows amongst investors. Knowing whether insiders are buying is usually more helpful when evaluating insider transactions, as insider selling can have various explanations. However, if numerous insiders are selling, shareholders should investigate more.

Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.

See our latest analysis for Camden Property Trust

Camden Property Trust Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by the President & Executive Vice Chairman of the Board, D. Oden, for US$6.7m worth of shares, at about US$133 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of US$162. 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. 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. This single sale was just 16% of D. Oden's stake.

Camden Property Trust insiders didn't buy any shares 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 want to know exactly who sold, for how much, and when, simply click on the graph below!

insider-trading-volume
NYSE:CPT Insider Trading Volume February 21st 2022

I will like Camden Property Trust better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

Insiders at Camden Property Trust Have Sold Stock Recently

The last quarter saw substantial insider selling of Camden Property Trust shares. Specifically, insiders ditched US$15m 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.

Does Camden Property Trust Boast High Insider Ownership?

Many investors like to check how much of a company is owned by insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Camden Property Trust insiders own 0.9% of the company, currently worth about US$155m based on the recent share price. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

What Might The Insider Transactions At Camden Property Trust Tell Us?

Insiders sold stock recently, but they haven't been buying. And there weren't any purchases to give us comfort, over the last year. On the plus side, Camden Property Trust makes money, and is growing profits. While insiders do own a lot of shares in the company (which is good), our analysis of their transactions doesn't make us feel confident about the company. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Every company has risks, and we've spotted 4 warning signs for Camden Property Trust (of which 1 is potentially serious!) 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, but not derivative transactions.

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