Have Southern Insiders Been Selling Stock?

Some The Southern Company (NYSE:SO) shareholders may be a little concerned to see that the CEO, President & Chairman, Christopher Womack, recently sold a substantial US$2.2m worth of stock at a price of US$90.13 per share. That's a big disposal, and it decreased their holding size by 21%, which is notable but not too bad.

See our latest analysis for Southern

The Last 12 Months Of Insider Transactions At Southern

The CEO, President & Chairman of Southern Company Gas, James Kerr, made the biggest insider sale in the last 12 months. That single transaction was for US$2.7m worth of shares at a price of US$89.64 each. So what is clear is that an insider saw fit to sell at around the current price of US$88.65. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. Given that the sale took place at around current prices, it makes us a little cautious but is hardly a major concern.

Southern insiders didn't buy any shares over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

I will like Southern better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.

Does Southern Boast High Insider Ownership?

Many investors like to check how much of a company is owned by insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Southern insiders own about US$206m worth of shares (which is 0.2% of the company). 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 Southern Insider Transactions Indicate?

Insiders sold Southern shares recently, but they didn't buy any. And even if we look at the last year, we didn't see any purchases. But since Southern is profitable and growing, we're not too worried by this. While insiders do own a lot of shares in the company (which is good), our analysis of their transactions doesn't make us feel confident about the company. 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. When we did our research, we found 3 warning signs for Southern (1 is a bit unpleasant!) that we believe deserve your full attention.

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 of direct interests only, but not derivative transactions or indirect interests.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.