As Microsoft Corporation's (NASDAQ:MSFT)) market cap dropped by US$165b, insiders who sold US$381m worth of stock were able to offset their losses

By
Simply Wall St
Published
May 13, 2022
NasdaqGS:MSFT
Source: Shutterstock

Insiders seem to have made the most of their holdings by selling US$381m worth of Microsoft Corporation (NASDAQ:MSFT) stock at an average sell price of US$333 during the past year. The company's market valuation decreased by US$165b after the stock price dropped 7.9% over the past week, but insiders were spared from painful losses.

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 Microsoft

The Last 12 Months Of Insider Transactions At Microsoft

In the last twelve months, the biggest single sale by an insider was when the Chairman & CEO, Satya Nadella, sold US$285m worth of shares at a price of US$349 per share. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. The good news is that this large sale was at well above current price of US$255. So it is hard to draw any strong conclusion from it.

Over the last year we saw more insider selling of Microsoft shares, than buying. 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!

insider-trading-volume
NasdaqGS:MSFT Insider Trading Volume May 13th 2022

I will like Microsoft better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

Insider Ownership

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. Microsoft insiders own about US$815m worth of shares (which is 0.04% 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.

What Might The Insider Transactions At Microsoft Tell Us?

The fact that there have been no Microsoft insider transactions recently certainly doesn't bother us. It's great to see high levels of insider ownership, but looking back over the last year, we don't gain confidence from the Microsoft insiders selling. Therefore, you should definitely take a look at this FREE report showing analyst forecasts for Microsoft.

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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