Don't Ignore The Insider Selling In TJX Companies

Some The TJX Companies, Inc. (NYSE:TJX) shareholders may be a little concerned to see that the CEO, President & Director, Ernie Herrman, recently sold a substantial US$8.2m worth of stock at a price of US$150 per share. However, it's crucial to note that they remain very much invested in the stock and that sale only reduced their holding by 9.6%.

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TJX Companies Insider Transactions Over The Last Year

Notably, that recent sale by Ernie Herrman is the biggest insider sale of TJX Companies 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$151, an insider wanted to cash in some shares. We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. We note that the biggest single sale was only 9.6% of Ernie Herrman's holding.

TJX Companies insiders didn't buy any shares over the last year. 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!

See our latest analysis for TJX Companies

I will like TJX Companies 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

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. We usually like to see fairly high levels of insider ownership. It's great to see that TJX Companies insiders own 0.1% of the company, worth about US$193m. 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 TJX Companies Tell Us?

Insiders sold TJX Companies shares recently, but they didn't buy any. Looking to the last twelve months, our data doesn't show any insider buying. On the plus side, TJX Companies makes money, and is growing profits. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. 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 1 warning sign for TJX Companies you should know about.

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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.