Don't Ignore The Insider Selling In DXC Technology

We'd be surprised if DXC Technology Company (NYSE:DXC) shareholders haven't noticed that an insider, Christopher Drumgoole, recently sold US$203k worth of stock at US$20.33 per share. However, the silver lining is that the sale only reduced their total holding by 6.9%, so we're hesitant to read anything much into it, on its own.

Check out our latest analysis for DXC Technology

The Last 12 Months Of Insider Transactions At DXC Technology

The Executive VP & General Counsel, William Deckelman, made the biggest insider sale in the last 12 months. That single transaction was for US$1.6m worth of shares at a price of US$20.72 each. That means that even when the share price was slightly below the current price of US$20.86, 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. However, while insider selling is sometimes discouraging, it's only a weak signal. We note that the biggest single sale was 65% of William Deckelman's holding.

DXC Technology 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!

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Insider Ownership Of DXC Technology

Many investors like to check how much of a company is owned by 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. DXC Technology insiders own about US$33m worth of shares. That equates to 0.9% of the company. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Do The DXC Technology Insider Transactions Indicate?

Insiders sold stock recently, but they haven't been buying. And there weren't any purchases to give us comfort, over the last year. While insiders do own shares, they don't own a heap, and they have been selling. We're in no rush to buy! If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.

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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.