Anyone interested in Telephone and Data Systems, Inc. (NYSE:TDS) should probably be aware that the Independent Director, Gary Sugarman, recently divested US$269k worth of shares in the company, at an average price of US$25.80 each. The eyebrow raising move amounted to a reduction of 24% in their holding.
Telephone and Data Systems Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider sale was by the Senior Vice President of Technology, Joseph Hanley, for US$317k worth of shares, at about US$22.87 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of US$25.72. As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower 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. It is worth noting that this sale was 50% of Joseph Hanley's holding.
Over the last year we saw more insider selling of Telephone and Data Systems shares, than buying. 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!
For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Does Telephone and Data Systems Boast High Insider Ownership?
For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Telephone and Data Systems insiders own 13% of the company, currently worth about US$368m 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.
So What Do The Telephone and Data Systems Insider Transactions Indicate?
The insider sales have outweighed the insider buying, at Telephone and Data Systems, in the last three months. And our longer term analysis of insider transactions didn't bring confidence, either. But since Telephone and Data Systems is profitable and growing, we're not too worried by this. It is good to see high insider ownership, but the insider selling leaves us cautious. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Telephone and Data Systems. For instance, we've identified 4 warning signs for Telephone and Data Systems (2 are a bit concerning) you should be aware of.
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.
When trading Telephone and Data Systems or any other investment, use the platform considered by many to be the Professional's Gateway to the Worlds Market, Interactive Brokers. You get the lowest-cost* trading on stocks, options, futures, forex, bonds and funds worldwide from a single integrated account.
This article by Simply Wall St is general in nature. 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.
*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.