Insiders At Public Service Enterprise Group Sold US$5.6m In Stock, Alluding To Potential Weakness

Many Public Service Enterprise Group Incorporated (NYSE:PEG) insiders ditched their stock over the past year, which may be of interest to the company's shareholders. Knowing whether insiders are buying is usually more helpful when evaluating insider transactions, as insider selling can have various explanations. However, when multiple insiders sell stock over a specific duration, shareholders should take notice as that could possibly be a red flag.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.

Check out our latest analysis for Public Service Enterprise Group

The Last 12 Months Of Insider Transactions At Public Service Enterprise Group

The Executive VP & Chief Legal Officer, Tamara Linde, made the biggest insider sale in the last 12 months. That single transaction was for US$1.5m worth of shares at a price of US$80.26 each. So it's clear an insider wanted to take some cash off the table, even below the current price of US$83.47. We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. However, while insider selling is sometimes discouraging, it's only a weak signal. This single sale was just 22% of Tamara Linde's stake.

Public Service Enterprise Group insiders didn't buy any shares over 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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Public Service Enterprise Group Insiders Are Selling The Stock

The last quarter saw substantial insider selling of Public Service Enterprise Group shares. Specifically, insiders ditched US$850k 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

For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. Public Service Enterprise Group insiders own about US$46m worth of shares. That equates to 0.1% of the company. 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 Do The Public Service Enterprise Group Insider Transactions Indicate?

Insiders sold Public Service Enterprise Group shares recently, but they didn't buy any. And even if we look at the last year, we didn't see any purchases. Insiders own shares, but we're still pretty cautious, given the history of sales. 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. To help with this, we've discovered 2 warning signs (1 doesn't sit too well with us!) that you ought to be aware of before buying any shares in Public Service Enterprise Group.

Of course Public Service Enterprise Group 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 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.