Don't Ignore The Insider Selling In Weave Communications

We wouldn't blame Weave Communications, Inc. (NYSE:WEAV) shareholders if they were a little worried about the fact that Brett White, the CEO & Director recently netted about US$869k selling shares at an average price of US$15.86. However, it's crucial to note that they remain very much invested in the stock and that sale only reduced their holding by 5.5%.

Check out our latest analysis for Weave Communications

The Last 12 Months Of Insider Transactions At Weave Communications

Notably, that recent sale by Brett White is the biggest insider sale of Weave Communications shares that we've seen in the last year. That means that even when the share price was below the current price of US$16.44, 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. This single sale was just 5.5% of Brett White's stake.

Insiders in Weave Communications didn't buy any shares in the last year. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

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Insider Ownership Of Weave Communications

For a common shareholder, it is worth checking how many shares are held by company 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. Insiders own 3.8% of Weave Communications shares, worth about US$45m. 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 Does This Data Suggest About Weave Communications Insiders?

Insiders sold Weave Communications shares recently, but they didn't buy any. And even if we look at the last year, we didn't see any purchases. Insider ownership isn't particularly high, so this analysis makes us cautious about the company. We'd practice some caution before buying! While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. While conducting our analysis, we found that Weave Communications has 2 warning signs and it would be unwise to ignore them.

But note: Weave Communications may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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.