CFO & COO Guy Melamed Sold A Bunch Of Shares In Varonis Systems

Some Varonis Systems, Inc. (NASDAQ:VRNS) shareholders may be a little concerned to see that the CFO & COO, Guy Melamed, recently sold a substantial US$4.9m worth of stock at a price of US$53.70 per share. That's a big disposal, and it decreased their holding size by 35%, which is notable but not too bad.

See our latest analysis for Varonis Systems

The Last 12 Months Of Insider Transactions At Varonis Systems

The Co-Founder, Yakov Faitelson, made the biggest insider sale in the last 12 months. That single transaction was for US$13m worth of shares at a price of US$45.23 each. That means that an insider was selling shares at slightly below the current price (US$51.08). When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. 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. This single sale was just 31% of Yakov Faitelson's stake.

In total, Varonis Systems insiders sold more than they bought 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 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).

Does Varonis Systems Boast High Insider Ownership?

For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. Varonis Systems insiders own about US$122m worth of shares (which is 2.1% 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 Do The Varonis Systems Insider Transactions Indicate?

An insider sold stock recently, but they haven't been buying. Zooming out, the longer term picture doesn't give us much comfort. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Varonis Systems. In terms of investment risks, we've identified 2 warning signs with Varonis Systems and understanding them should be part of your investment process.

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.