ON Semiconductor Insiders Sell US$5.3m Of Stock, Possibly Signalling Caution

The fact that multiple ON Semiconductor Corporation (NASDAQ:ON) insiders offloaded a considerable amount of shares over the past year could have raised some eyebrows amongst investors. Knowing whether insiders are buying is usually more helpful when evaluating insider transactions, as insider selling can have various explanations. However, shareholders should take a deeper look if several insiders are selling stock over a specific time period.

While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

View our latest analysis for ON Semiconductor

The Last 12 Months Of Insider Transactions At ON Semiconductor

Over the last year, we can see that the biggest insider sale was by the Executive VP, Thad Trent, for US$2.8m worth of shares, at about US$72.55 per share. So we know that an insider sold shares at around the present share price of US$71.05. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. In this case, the big sale took place at around the current price, so it's not too bad (but it's still not a positive).

ON Semiconductor insiders didn't buy any shares 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!

I will like ON Semiconductor 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.

Insiders At ON Semiconductor Have Sold Stock Recently

Over the last three months, we've seen significant insider selling at ON Semiconductor. Specifically, insiders ditched US$2.5m worth of shares in that time, and we didn't record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.

Insider Ownership

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. ON Semiconductor insiders own about US$103m worth of shares (which is 0.3% 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 Do The ON Semiconductor Insider Transactions Indicate?

Insiders haven't bought ON Semiconductor 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. 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. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing ON Semiconductor. Every company has risks, and we've spotted 1 warning sign for ON Semiconductor you should know about.

But note: ON Semiconductor 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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