Akamai Technologies Insiders Sell US$2.5m Of Stock, Possibly Signalling Caution

Over the past year, many Akamai Technologies, Inc. (NASDAQ:AKAM) insiders sold a significant stake in the company which may have piqued investors' interest. When analyzing insider transactions, it is usually more valuable to know whether insiders are buying versus knowing if they are selling, as the latter sends an ambiguous message. However, when multiple insiders sell stock over a specific duration, shareholders should take notice as that could possibly be a red flag.

While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.

View our latest analysis for Akamai Technologies

Akamai Technologies Insider Transactions Over The Last Year

In the last twelve months, the biggest single purchase by an insider was when Co-Founder F. Leighton bought US$2.0m worth of shares at a price of US$92.68 per share. That implies that an insider found the current price of US$94.58 per share to be enticing. That means they have been optimistic about the company in the past, though they may have changed their mind. While we always like to see insider buying, it's less meaningful if the purchases were made at much lower prices, as the opportunity they saw may have passed. Happily, the Akamai Technologies insider decided to buy shares at close to current prices. F. Leighton was the only individual insider to buy shares in the last twelve months.

In total, Akamai Technologies insiders sold more than they bought over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

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Insiders At Akamai Technologies Have Sold Stock Recently

The last quarter saw substantial insider selling of Akamai Technologies shares. In total, Executive VP Aaron Ahola dumped US$347k worth of shares in that time, and we didn't record any purchases whatsoever. Overall this makes us a bit cautious, but it's not the be all and end all.

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. It's great to see that Akamai Technologies insiders own 1.8% of the company, worth about US$256m. 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 Akamai Technologies Insider Transactions Indicate?

An insider sold Akamai Technologies shares recently, but they didn't buy any. Zooming out, the longer term picture doesn't give us much comfort. On the plus side, Akamai Technologies makes money, and is growing profits. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. Of course, the future is what matters most. So if you are interested in Akamai Technologies, you should check out this free report on analyst forecasts for the company.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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.