Possible bearish signals as Insight Enterprises, Inc. (NASDAQ:NSIT) insiders disposed of US$2.2m worth of stock

By
Simply Wall St
Published
November 24, 2021
NasdaqGS:NSIT
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Many Insight Enterprises, Inc. (NASDAQ:NSIT) insiders ditched their stock over the past year, which may be of interest to the company's shareholders. When analyzing insider transactions, it is usually more valuable to know whether insiders are buying versus knowing if they are selling, as the latter sends an ambiguous message. However, if numerous insiders are selling, shareholders should investigate more.

While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

View our latest analysis for Insight Enterprises

Insight Enterprises Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by the Senior VP, Samuel Cowley, for US$625k worth of shares, at about US$83.33 per share. That means that even when the share price was below the current price of US$103, an insider wanted to cash in some shares. When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. This single sale was just 38% of Samuel Cowley's stake.

Insight Enterprises insiders didn't buy any shares 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!

insider-trading-volume
NasdaqGS:NSIT Insider Trading Volume November 24th 2021

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

Insight Enterprises Insiders Are Selling The Stock

Over the last three months, we've seen significant insider selling at Insight Enterprises. In total, insiders dumped US$553k 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.

Does Insight Enterprises Boast High 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. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 2.1% of Insight Enterprises shares, worth about US$76m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Does This Data Suggest About Insight Enterprises Insiders?

Insiders sold stock recently, but they haven't been buying. And even if we look at the last year, we didn't see any purchases. But it is good to see that Insight Enterprises is growing earnings. Insider ownership isn't particularly high, so this analysis makes us cautious about the company. We'd practice some caution before buying! While we like knowing 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. Be aware that Insight Enterprises is showing 3 warning signs in our investment analysis, and 2 of those can't be ignored...

Of course Insight Enterprises 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.

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.

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