We'd be surprised if NXP Semiconductors N.V. (NASDAQ:NXPI) shareholders haven't noticed that an insider, Christopher Jensen, recently sold US$348k worth of stock at US$183 per share. In particular, we note that the sale equated to a 61% reduction in their position size, which doesn't exactly instill confidence.
The Last 12 Months Of Insider Transactions At NXP Semiconductors
Over the last year, we can see that the biggest insider sale was by the Independent Chairman of the Board, Peter Bonfield, for US$1.9m worth of shares, at about US$158 per share. That means that even when the share price was below the current price of US$188, an insider wanted to cash in some shares. As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. However, while insider selling is sometimes discouraging, it's only a weak signal. It is worth noting that this sale was only 45% of Peter Bonfield's holding.
In the last twelve months insiders purchased 1.67k shares for US$219k. But insiders sold 41.62k shares worth US$6.4m. All up, insiders sold more shares in NXP Semiconductors than they bought, over the last year. 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!
If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: insiders have been buying them).
Insider Ownership of NXP Semiconductors
Many investors like to check how much of a company is owned by insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. NXP Semiconductors insiders own about US$227m worth of shares (which is 0.4% of the company). I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
So What Does This Data Suggest About NXP Semiconductors Insiders?
Insiders haven't bought NXP Semiconductors stock in the last three months, but there was some selling. Despite some insider buying, the longer term picture doesn't make us feel much more positive. It is good to see high insider ownership, but the insider selling leaves us cautious. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing NXP Semiconductors. When we did our research, we found 5 warning signs for NXP Semiconductors (1 is significant!) that we believe deserve your full attention.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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, but not derivative transactions.
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