Don't Ignore The Insider Selling In EPAM Systems

Some EPAM Systems, Inc. (NYSE:EPAM) shareholders may be a little concerned to see that insider Sergey Yezhkov recently sold a substantial US$1.5m worth of stock at a price of US$151 per share. Probably the most concerning element of the whole transaction is that the disposal amounted to 61% of their entire holding.

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The Last 12 Months Of Insider Transactions At EPAM Systems

In fact, the recent sale by Sergey Yezhkov was the biggest sale of EPAM Systems shares made by an insider individual in the last twelve months, according to our records. So it's clear an insider wanted to take some cash off the table, even slightly below the current price of US$153. 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. 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 61% of Sergey Yezhkov's stake.

In total, EPAM Systems insiders sold more 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!

See our latest analysis for EPAM Systems

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Insider Ownership Of EPAM Systems

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. It's great to see that EPAM Systems insiders own 3.3% of the company, worth about US$286m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Do The EPAM Systems Insider Transactions Indicate?

An insider hasn't bought EPAM Systems stock in the last three months, but there was some selling. And our longer term analysis of insider transactions didn't bring confidence, either. 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 EPAM Systems. Case in point: We've spotted 1 warning sign for EPAM Systems you should be aware of.

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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.