Don't Ignore The Insider Selling In Knowles

Anyone interested in Knowles Corporation (NYSE:KN) should probably be aware that the Independent Director, Cheryl Shavers, recently divested US$217k worth of shares in the company, at an average price of US$17.29 each. The eyebrow raising move amounted to a reduction of 25% in their holding.

View our latest analysis for Knowles

The Last 12 Months Of Insider Transactions At Knowles

Notably, that recent sale by Cheryl Shavers is the biggest insider sale of Knowles shares that we've seen in the last year. So it's clear an insider wanted to take some cash off the table, even below the current price of US$17.85. 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. However, while insider selling is sometimes discouraging, it's only a weak signal. It is worth noting that this sale was only 25% of Cheryl Shavers's holding.

Insiders in Knowles didn't buy any shares in the last year. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

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Insider Ownership Of Knowles

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 1.6% of Knowles shares, worth about US$25m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

So What Do The Knowles Insider Transactions Indicate?

An insider hasn't bought Knowles stock in the last three months, but there was some selling. And even if we look at the last year, we didn't see any purchases. While insiders do own shares, they don't own a heap, and they have been selling. 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. You'd be interested to know, that we found 2 warning signs for Knowles and we suggest you have a look.

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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.