Don't Ignore The Insider Selling In Virtus Investment Partners

Anyone interested in Virtus Investment Partners, Inc. (NYSE:VRTS) should probably be aware that the Independent Non-Executive Director, Susan S. Cabrera, recently divested US$498k worth of shares in the company, at an average price of US$168 each. That sale was 18% of their holding, so it does make us raise an eyebrow.

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Virtus Investment Partners Insider Transactions Over The Last Year

In fact, the recent sale by Susan S. Cabrera was the biggest sale of Virtus Investment Partners shares made by an insider individual in the last twelve months, according to our records. That means that an insider was selling shares at below the current price (US$169). 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. However, while insider selling is sometimes discouraging, it's only a weak signal. This single sale was just 18% of Susan S. Cabrera's stake.

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!

View our latest analysis for Virtus Investment Partners

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Insider Ownership

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 6.6% of Virtus Investment Partners shares, worth about US$75m. 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 Virtus Investment Partners Insiders?

An insider sold Virtus Investment Partners shares recently, but they didn't buy any. Looking to the last twelve months, our data doesn't show any insider buying. But since Virtus Investment Partners is profitable and growing, we're not too worried by this. Insider ownership isn't particularly high, so this analysis makes us cautious about the company. We're in no rush to buy! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Every company has risks, and we've spotted 2 warning signs for Virtus Investment Partners (of which 1 makes us a bit uncomfortable!) you should know about.

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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.