Insiders at National Instruments Corporation (NASDAQ:NATI) sold US$3.3m worth of stock, possibly indicating weakness in the future

By
Simply Wall St
Published
May 21, 2022
NasdaqGS:NATI
Source: Shutterstock

The fact that multiple National Instruments Corporation (NASDAQ:NATI) insiders offloaded a considerable amount of shares over the past year could have raised some eyebrows amongst investors. Knowing whether insiders are buying is usually more helpful when evaluating insider transactions, as insider selling can have various explanations. However, shareholders should take a deeper look if several insiders are selling stock over a specific time period.

While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.

See our latest analysis for National Instruments

National Instruments Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the Executive Vice President of Platform & Technology, Scott Rust, sold US$824k worth of shares at a price of US$44.02 per share. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. The silver lining is that this sell-down took place above the latest price (US$33.29). So it may not shed much light on insider confidence at current levels.

All up, insiders sold more shares in National Instruments than they bought, over 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!

insider-trading-volume
NasdaqGS:NATI Insider Trading Volume May 21st 2022

I will like National Instruments better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

Insiders at National Instruments Have Sold Stock Recently

The last quarter saw substantial insider selling of National Instruments shares. Specifically, insiders ditched US$1.1m worth of shares in that time, and we didn't record any purchases whatsoever. Overall this makes us a bit cautious, but it's not the be all and end all.

Insider Ownership

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. We usually like to see fairly high levels of insider ownership. It appears that National Instruments insiders own 0.8% of the company, worth about US$36m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

What Might The Insider Transactions At National Instruments Tell Us?

Insiders haven't bought National Instruments stock in the last three months, but there was some selling. Zooming out, the longer term picture doesn't give us much comfort. On the plus side, National Instruments makes money, and is growing profits. Insiders own shares, but we're still pretty cautious, given the history of sales. 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. Case in point: We've spotted 2 warning signs for National Instruments you should be aware of, and 1 of these doesn't sit too well with us.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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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