Trade Alert: The Co-Founder & Director Of ChannelAdvisor Corporation (NYSE:ECOM), Mitchell Wingo, Has Sold Some Shares Recently

Some ChannelAdvisor Corporation (NYSE:ECOM) shareholders may be a little concerned to see that the Co-Founder & Director, Mitchell Wingo, recently sold a substantial US$701k worth of stock at a price of US$23.38 per share. That sale reduced their total holding by 32% which is hardly insignificant, but far from the worst we've seen.

See our latest analysis for ChannelAdvisor

The Last 12 Months Of Insider Transactions At ChannelAdvisor

Notably, that recent sale by Co-Founder & Director Mitchell Wingo was not the only time they sold ChannelAdvisor shares this year. Earlier in the year, they fetched US$13.99 per share in a -US$1.4m sale. So it's clear an insider wanted to take some cash off the table, even below the current price of US$24.63. As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. However, while insider selling is sometimes discouraging, it's only a weak signal. It is worth noting that this sale was only 36% of Mitchell Wingo's holding.

In the last twelve months insiders purchased 24.15k shares for US$127k. On the other hand they divested 160.50k shares, for US$2.8m. All up, insiders sold more shares in ChannelAdvisor than they bought, over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

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

Does ChannelAdvisor Boast High Insider Ownership?

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. ChannelAdvisor insiders own about US$22m worth of shares. That equates to 3.0% 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 ChannelAdvisor Insider Transactions Indicate?

Insiders sold stock recently, but they haven't been buying. Despite some insider buying, the longer term picture doesn't make us feel much more positive. But it is good to see that ChannelAdvisor is growing earnings. While insiders do own shares, they don't own a heap, and they have been selling. So we'd only buy after careful consideration. 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. For example - ChannelAdvisor has 3 warning signs we think you should be aware of.

Of course ChannelAdvisor may not be the best stock to buy. So you may wish to see this free collection of high quality 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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This article by Simply Wall St is general in nature. 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.
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