Have Pinnacle West Capital Corporation (NYSE:PNW) Insiders Been Selling Their Stock?

By
Simply Wall St
Published
November 12, 2021
NYSE:PNW
Source: Shutterstock

We'd be surprised if Pinnacle West Capital Corporation (NYSE:PNW) shareholders haven't noticed that the Advisor to the Chief Executive Officer, James Hatfield, recently sold US$212k worth of stock at US$63.76 per share. That sale was 11% of their holding, so it does make us raise an eyebrow.

Check out our latest analysis for Pinnacle West Capital

The Last 12 Months Of Insider Transactions At Pinnacle West Capital

Notably, that recent sale by James Hatfield is the biggest insider sale of Pinnacle West Capital shares that we've seen in the last year. That means that an insider was selling shares at slightly below the current price (US$66.10). 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. 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 11%of James Hatfield's holding.

You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

insider-trading-volume
NYSE:PNW Insider Trading Volume November 13th 2021

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

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. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 0.3% of Pinnacle West Capital shares, worth about US$20m. 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 Does This Data Suggest About Pinnacle West Capital Insiders?

An insider sold stock recently, but they haven't been buying. And there weren't any purchases to give us comfort, over the last year. While insiders do own shares, they don't own a heap, and they have been selling. We're in no rush to buy! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Pinnacle West Capital. Every company has risks, and we've spotted 3 warning signs for Pinnacle West Capital (of which 2 are concerning!) you should know about.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity and low debt.

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.

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