Have Alarm.com Holdings Insiders Been Selling Stock?

We'd be surprised if Alarm.com Holdings, Inc. (NASDAQ:ALRM) shareholders haven't noticed that the CEO & Director, Stephen Trundle, recently sold US$266k worth of stock at US$43.78 per share. However, the silver lining is that the sale only reduced their total holding by 0.3%, so we're hesitant to read anything much into it, on its own.

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The Last 12 Months Of Insider Transactions At Alarm.com Holdings

Notably, that recent sale by CEO & Director Stephen Trundle was not the only time they traded Alarm.com Holdings shares this year. Earlier in the year, they spent US$1.3m to buy shares at US$48.66 per share. That means that an insider was happy to buy shares at above the current price of US$45.11. Their view may have changed since then, but at least it shows they felt optimistic at the time. We always take careful note of the price insiders pay when purchasing shares. It is encouraging to see an insider paid above the current price for shares, as it suggests they saw value, even at higher levels. Stephen Trundle was the only individual insider to buy shares in the last twelve months.

In total, Alarm.com Holdings insiders sold more than they bought over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

See our latest analysis for Alarm.com Holdings

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Does Alarm.com Holdings Boast High Insider Ownership?

For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Alarm.com Holdings insiders own 5.2% of the company, currently worth about US$115m based on the recent share price. 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 Does This Data Suggest About Alarm.com Holdings Insiders?

Insiders sold stock recently, but they haven't been buying. And our longer term analysis of insider transactions didn't bring confidence, either. 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. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Alarm.com Holdings. While conducting our analysis, we found that Alarm.com Holdings has 1 warning sign and it would be unwise to ignore this.

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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.