Don't Ignore The Insider Selling In Manhattan Associates

We wouldn't blame Manhattan Associates, Inc. (NASDAQ:MANH) shareholders if they were a little worried about the fact that J. Gantt, the Executive Vice President of Professional Services - Americas recently netted about US$1.0m selling shares at an average price of US$288. That sale reduced their total holding by 11% which is hardly insignificant, but far from the worst we've seen.

See our latest analysis for Manhattan Associates

Manhattan Associates Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the President, Eddie Capel, sold US$11m worth of shares at a price of US$251 per share. That means that even when the share price was below the current price of US$285, 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. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. It is worth noting that this sale was 55% of Eddie Capel's holding.

Manhattan Associates insiders didn't buy any shares over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

If you are like me, then you will not want to miss this free list of small cap stocks that are not only being bought by insiders but also have attractive valuations.

Does Manhattan Associates Boast High Insider Ownership?

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with 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. Manhattan Associates insiders own about US$136m worth of shares (which is 0.8% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Does This Data Suggest About Manhattan Associates Insiders?

Insiders sold Manhattan Associates shares recently, but they didn't buy any. And there weren't any purchases to give us comfort, over the last year. But it is good to see that Manhattan Associates is growing earnings. 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 Manhattan Associates. At Simply Wall St, we found 1 warning sign for Manhattan Associates that deserve your attention before buying any shares.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.