Don't Ignore The Insider Selling In Zurn Elkay Water Solutions

Some Zurn Elkay Water Solutions Corporation (NYSE:ZWS) shareholders may be a little concerned to see that the Senior VP & Chief Administrative Officer, Mark Peterson, recently sold a substantial US$1.3m worth of stock at a price of US$53.02 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 7.6%.

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The Last 12 Months Of Insider Transactions At Zurn Elkay Water Solutions

Over the last year, we can see that the biggest insider sale was by the CEO & Chairman, Todd Adams, for US$28m worth of shares, at about US$52.68 per share. That means that an insider was selling shares at around the current price of US$51.42. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. We note that this sale took place at around the current price, so it isn't a major concern, though it's hardly a good sign.

In the last year Zurn Elkay Water Solutions insiders didn't buy any company stock. 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!

Check out our latest analysis for Zurn Elkay Water Solutions

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).

Does Zurn Elkay Water Solutions Boast High 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. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Zurn Elkay Water Solutions insiders own 2.3% of the company, currently worth about US$193m based on the recent share price. 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 Zurn Elkay Water Solutions Insider Transactions Indicate?

An insider sold stock recently, but they haven't been buying. And even if we look at the last year, we didn't see any purchases. But since Zurn Elkay Water Solutions 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. Case in point: We've spotted 1 warning sign for Zurn Elkay Water Solutions you should be aware of.

Of course Zurn Elkay Water Solutions may not be the best stock to buy. So you may wish to see this free collection of high quality 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.