Satya Nadella Is The Chairman & CEO of Microsoft Corporation (NASDAQ:MSFT) And They Just Sold 53% Of Their Shares

Some Microsoft Corporation (NASDAQ:MSFT) shareholders may be a little concerned to see that the Chairman & CEO, Satya Nadella, recently sold a substantial US$285m worth of stock at a price of US$340 per share. That diminished their holding by a very significant 53%, which arguably implies a strong desire to reallocate capital.

View our latest analysis for Microsoft

Microsoft Insider Transactions Over The Last Year

Notably, that recent sale by Satya Nadella is the biggest insider sale of Microsoft shares that we've seen in the last year. That means that an insider was selling shares at around the current price of US$331. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. Given that the sale took place at around current prices, it makes us a little cautious but is hardly a major concern.

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. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

Does Microsoft Boast High Insider Ownership?

For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Microsoft insiders own about US$1.5b worth of shares (which is 0.06% of the company). Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Do The Microsoft Insider Transactions Indicate?

Insiders sold Microsoft shares recently, but they didn't buy any. Despite some insider buying, the longer term picture doesn't make us feel much more positive. But since Microsoft is profitable and growing, we're not too worried by this. It is good to see high insider ownership, but the insider selling leaves us cautious. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. Case in point: We've spotted 1 warning sign for Microsoft you should be aware of.

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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