Have Insiders Sold Broadcom Shares Recently?

We wouldn't blame Broadcom Inc. (NASDAQ:AVGO) shareholders if they were a little worried about the fact that Charlie Kawwas, the President of Semiconductor Solutions recently netted about US$2.5m selling shares at an average price of US$253. However, it's crucial to note that they remain very much invested in the stock and that sale only reduced their holding by 1.2%.

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Broadcom Insider Transactions Over The Last Year

The Independent Chairman of the Board, Henry Samueli, made the biggest insider sale in the last 12 months. That single transaction was for US$121m worth of shares at a price of US$188 each. That means that even when the share price was below the current price of US$249, an insider wanted to cash in some shares. 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. 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. This single sale was just 1.3% of Henry Samueli's stake.

In the last year Broadcom insiders didn't buy any company stock. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

See our latest analysis for Broadcom

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

Does Broadcom 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. It's great to see that Broadcom insiders own 1.2% of the company, worth about US$14b. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

What Might The Insider Transactions At Broadcom Tell Us?

Insiders haven't bought Broadcom stock in the last three months, but there was some selling. And there weren't any purchases to give us comfort, over the last year. But it is good to see that Broadcom is growing earnings. It is good to see high insider ownership, but the insider selling leaves us cautious. 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. To assist with this, we've discovered 2 warning signs that you should run your eye over to get a better picture of Broadcom.

But note: Broadcom 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.