Independent Director Of Sinclair Sold 63% Of Their Shares

We wouldn't blame Sinclair, Inc. (NASDAQ:SBGI) shareholders if they were a little worried about the fact that Daniel Keith, the Independent Director recently netted about US$550k selling shares at an average price of US$13.10. That diminished their holding by a very significant 63%, which arguably implies a strong desire to reallocate capital.

AI is about to change healthcare. These 20 stocks are working on everything from early diagnostics to drug discovery. The best part - they are all under $10bn in marketcap - there is still time to get in early.

Sinclair Insider Transactions Over The Last Year

The Executive Chairman of the Board David Smith made the biggest insider purchase in the last 12 months. That single transaction was for US$2.5m worth of shares at a price of US$13.66 each. That means that an insider was happy to buy shares at above the current price of US$13.52. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. To us, it's very important to consider the price insiders pay for shares. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.

Happily, we note that in the last year insiders paid US$2.5m for 189.15k shares. On the other hand they divested 106.31k shares, for US$1.6m. In the last twelve months there was more buying than selling by Sinclair insiders. The chart below shows insider transactions (by companies and individuals) over the last year. 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 Sinclair

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying.

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. Sinclair insiders own about US$404m worth of shares (which is 42% of the company). Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Do The Sinclair Insider Transactions Indicate?

Insiders sold stock recently, but they haven't been buying. In contrast, they appear keener if you look at the last twelve months. On top of that, insiders own a significant portion of the company. So we're happy to look past recent trading. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Our analysis shows 3 warning signs for Sinclair (1 makes us a bit uncomfortable!) and we strongly recommend you look at these before investing.

But note: Sinclair may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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.