We'd be surprised if Realty Income Corporation (NYSE:O) shareholders haven't noticed that the Independent Director, Ronald Merriman, recently sold US$280k worth of stock at US$70.05 per share. That sale was 15% of their holding, so it does make us raise an eyebrow.
The Last 12 Months Of Insider Transactions At Realty Income
The Independent Director, A. Chapman, made the biggest insider sale in the last 12 months. That single transaction was for US$553k worth of shares at a price of US$61.40 each. That means that an insider was selling shares at slightly below the current price (US$68.45). 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. 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. We note that the biggest single sale was only 48% of A. Chapman's holding.
Over the last year we saw more insider selling of Realty Income shares, than buying. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: insiders have been buying them).
Does Realty Income Boast High Insider Ownership?
For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 0.2% of Realty Income shares, worth about US$47m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
What Might The Insider Transactions At Realty Income Tell Us?
Insiders haven't bought Realty Income stock in the last three months, but there was some selling. Despite some insider buying, the longer term picture doesn't make us feel much more positive. 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 instance, we've identified 5 warning signs for Realty Income (1 makes us a bit uncomfortable) you should be aware of.
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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