Have Karooooo Insiders Been Selling Stock?

Some Karooooo Ltd. (NASDAQ:KARO) shareholders may be a little concerned to see that the Founder, Isaias Jose Calisto, recently sold a substantial US$3.1m worth of stock at a price of US$63.78 per share. However, it's crucial to note that they remain very much invested in the stock and that sale only reduced their holding by 0.3%.

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The Last 12 Months Of Insider Transactions At Karooooo

Notably, that recent sale by Isaias Jose Calisto is the biggest insider sale of Karooooo shares that we've seen in the last year. That means that even when the share price was slightly below the current price of US$64.46, an insider wanted to cash in some shares. We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. We note that the biggest single sale was only 0.3% of Isaias Jose Calisto's holding.

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 Karooooo

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: Most of them are flying under the radar).

Insider Ownership

For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Karooooo insiders own about US$1.4b worth of shares (which is 69% 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.

What Might The Insider Transactions At Karooooo Tell Us?

An insider sold Karooooo shares recently, but they didn't buy any. Looking to the last twelve months, our data doesn't show any insider buying. But since Karooooo is profitable and growing, we're not too worried by this. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. In terms of investment risks, we've identified 2 warning signs with Karooooo and understanding them should be part of your investment process.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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.