Don't Ignore The Insider Selling In Dell Technologies

Some Dell Technologies Inc. (NYSE:DELL) shareholders may be a little concerned to see that the Director, Egon Durban, recently sold a substantial US$9.8m worth of stock at a price of US$138 per share. 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%.

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The Last 12 Months Of Insider Transactions At Dell Technologies

Over the last year, we can see that the biggest insider sale was by the Chairman & CEO, Michael Dell, for US$1.2b worth of shares, at about US$122 per share. That means that even when the share price was below the current price of US$128, 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. 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. We note that the biggest single sale was only 27% of Michael Dell's holding.

In the last year Dell Technologies insiders didn't buy any company stock. 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!

Check out our latest analysis for Dell Technologies

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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. Dell Technologies insiders own 41% of the company, currently worth about US$36b based on the recent share price. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

What Might The Insider Transactions At Dell Technologies Tell Us?

Insiders sold Dell Technologies shares recently, but they didn't buy any. Looking to the last twelve months, our data doesn't show any insider buying. On the plus side, Dell Technologies makes money, and is growing profits. It is good to see high insider ownership, but the insider selling leaves us cautious. 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. You'd be interested to know, that we found 2 warning signs for Dell Technologies and we suggest you have a look.

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 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.