Insiders At Urban Outfitters Sold US$3.6m In Stock, Alluding To Potential Weakness

The fact that multiple Urban Outfitters, Inc. (NASDAQ:URBN) 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, when multiple insiders sell stock over a specific duration, shareholders should take notice as that could possibly be a red flag.

While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

View our latest analysis for Urban Outfitters

The Last 12 Months Of Insider Transactions At Urban Outfitters

In the last twelve months, the biggest single sale by an insider was when the COO & Co-President, Francis Conforti, sold US$1.5m worth of shares at a price of US$42.64 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of US$56.96. 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. However, while insider selling is sometimes discouraging, it's only a weak signal. We note that the biggest single sale was 99% of Francis Conforti's holding.

Insiders in Urban Outfitters didn't buy any shares in the last year. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

I will like Urban Outfitters 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.

Insider Ownership Of Urban Outfitters

Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. Urban Outfitters insiders own 28% of the company, currently worth about US$1.5b 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 Urban Outfitters Tell Us?

It doesn't really mean much that no insider has traded Urban Outfitters shares in the last quarter. While we feel good about high insider ownership of Urban Outfitters, we can't say the same about the selling of shares. If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.

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.