Don't Ignore The Insider Selling In Genesco

We'd be surprised if Genesco Inc. (NYSE:GCO) shareholders haven't noticed that the Senior VP and President of Johnston & Murphy Group, Daniel Ewoldsen, recently sold US$171k worth of stock at US$42.68 per share. However, the silver lining is that the sale only reduced their total holding by 8.8%, so we're hesitant to read anything much into it, on its own.

View our latest analysis for Genesco

Genesco Insider Transactions Over The Last Year

Notably, that recent sale by Daniel Ewoldsen is the biggest insider sale of Genesco shares that we've seen in the last year. So we know that an insider sold shares at around the present share price of US$40.68. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. We note that this sale took place at around the current price, so it isn't a major concern, though it's hardly a good sign.

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!

For those who like to find hidden gems this free list of small cap companies with recent insider purchasing, could be just the ticket.

Insider Ownership

Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 8.9% of Genesco shares, worth about US$44m. 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 Genesco Insider Transactions Indicate?

An insider sold Genesco shares recently, but they didn't buy any. And even if we look at the last year, we didn't see any purchases. Insiders own shares, but we're still pretty cautious, given the history of sales. We'd practice some caution before buying! While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. For example, Genesco has 2 warning signs (and 1 which makes us a bit uncomfortable) we think you should know about.

But note: Genesco 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.