This Insider Has Just Sold Shares In RealReal

Some The RealReal, Inc. (NASDAQ:REAL) shareholders may be a little concerned to see that insider John Koryl recently sold a substantial US$3.8m worth of stock at a price of US$9.61 per share. Probably the most concerning element of the whole transaction is that the disposal amounted to 100% of their entire holding.

View our latest analysis for RealReal

The Last 12 Months Of Insider Transactions At RealReal

Notably, that recent sale by John Koryl is the biggest insider sale of RealReal shares that we've seen in the last year. 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$8.73). So it is hard to draw any strong conclusion from it.

Happily, we note that in the last year insiders paid US$75k for 26.33k shares. On the other hand they divested 1.20m shares, for US$7.7m. All up, insiders sold more shares in RealReal than they bought, over the last year. They sold for an average price of about US$6.42. It's not too encouraging to see that insiders have sold at below the current price. Since insiders sell for many reasons, we wouldn't put too much weight on it. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

I will like RealReal better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.

Does RealReal Boast High 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 appears that RealReal insiders own 9.2% of the company, worth about US$88m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Do The RealReal Insider Transactions Indicate?

Insiders sold RealReal shares recently, but they didn't buy any. 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. So we'd only buy after careful consideration. 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 5 warning signs for RealReal you should be aware of, and 1 of these is concerning.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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.