Have Best Buy Insiders Been Selling Stock?

We wouldn't blame Best Buy Co., Inc. (NYSE:BBY) shareholders if they were a little worried about the fact that Richard Schulze, the Founder & Chairman Emeritus recently netted about US$39m selling shares at an average price of US$72.95. However, it's crucial to note that they remain very much invested in the stock and that sale only reduced their holding by 3.4%.

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The Last 12 Months Of Insider Transactions At Best Buy

Notably, that recent sale by Founder & Chairman Emeritus Richard Schulze was not the only time they sold Best Buy shares this year. They previously made an even bigger sale of -US$88m worth of shares at a price of US$89.58 per share. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. The silver lining is that this sell-down took place above the latest price (US$72.54). So it is hard to draw any strong conclusion from it.

Over the last year we saw more insider selling of Best Buy shares, than buying. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

Check out our latest analysis for Best Buy

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Does Best Buy Boast High Insider Ownership?

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. Best Buy insiders own about US$1.2b worth of shares (which is 7.8% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Does This Data Suggest About Best Buy Insiders?

Insiders sold Best Buy shares recently, but they didn't buy any. Zooming out, the longer term picture doesn't give us much comfort. 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 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. While conducting our analysis, we found that Best Buy has 3 warning signs and it would be unwise to ignore these.

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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.