Grid Dynamics Holdings Repeat Insider Selling Not A Positive Indicator

Grid Dynamics Holdings, Inc. (NASDAQ:GDYN) shareholders may have reason to be concerned, as several insiders sold their shares over the past year. Knowing whether insiders are buying is usually more helpful when evaluating insider transactions, as insider selling can have various explanations. However, if numerous insiders are selling, shareholders should investigate more.

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.

Check out our latest analysis for Grid Dynamics Holdings

The Last 12 Months Of Insider Transactions At Grid Dynamics Holdings

In the last twelve months, the biggest single sale by an insider was when the Independent Chairman, Lloyd Carney, sold US$214k worth of shares at a price of US$11.61 per share. That means that even when the share price was below the current price of US$12.93, 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 1.7% of Lloyd Carney's holding.

Insiders in Grid Dynamics Holdings didn't buy any shares in the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. 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: Most of them are flying under the radar).

Grid Dynamics Holdings Insiders Are Selling The Stock

We have seen a bit of insider selling at Grid Dynamics Holdings, over the last three months. Independent Director Shuo Zhang divested only US$37k worth of shares in that time. Neither the lack of buying nor the presence of selling is heartening. But the volume sold is so low that it really doesn't bother us.

Insider Ownership

For a common shareholder, it is worth checking how many shares are held by company 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 appears that Grid Dynamics Holdings insiders own 6.9% of the company, worth about US$71m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Does This Data Suggest About Grid Dynamics Holdings Insiders?

While there has not been any insider buying in the last three months, there has been selling. But given the selling was modest, we're not worried. We're a little cautious about the insider selling at Grid Dynamics Holdings. But it's good to see that insiders own shares in the company. Therefore, you should definitely take a look at this FREE report showing analyst forecasts for Grid Dynamics Holdings.

Of course Grid Dynamics Holdings may not be the best stock to buy. So you may wish to see this free collection of high quality 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 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.