This Insider Has Just Sold Shares In LKQ

Some LKQ Corporation (NASDAQ:LKQ) shareholders may be a little concerned to see that the Director, Dominick Zarcone, recently sold a substantial US$635k worth of stock at a price of US$42.32 per share. However, that sale only accounted for 4.3% of their holding, so arguably it doesn't say much about their conviction.

Check out our latest analysis for LKQ

The Last 12 Months Of Insider Transactions At LKQ

Notably, that recent sale by Dominick Zarcone is the biggest insider sale of LKQ shares that we've seen in the last year. That means that even when the share price was slightly below the current price of US$42.75, an insider wanted to cash in some shares. 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. This single sale was just 4.3% of Dominick Zarcone's stake.

Happily, we note that in the last year insiders paid US$621k for 15.58k shares. But insiders sold 35.00k shares worth US$1.4m. Dominick Zarcone ditched 35.00k shares over the year. The average price per share was US$40.47. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

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Does LKQ 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. It appears that LKQ insiders own 0.7% of the company, worth about US$80m. 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 Do The LKQ Insider Transactions Indicate?

An insider hasn't bought LKQ stock in the last three months, but there was some selling. Zooming out, the longer term picture doesn't give us much comfort. While insiders do own shares, they don't own a heap, and they have been selling. We're in no rush to buy! 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. Every company has risks, and we've spotted 2 warning signs for LKQ you should know about.

But note: LKQ 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.