Don't Ignore The Insider Selling In PNC Financial Services Group

We wouldn't blame The PNC Financial Services Group, Inc. (NYSE:PNC) shareholders if they were a little worried about the fact that Stacy Juchno, a company insider, recently netted about US$858k selling shares at an average price of US$256. That sale reduced their total holding by 15% which is hardly insignificant, but far from the worst we've seen.

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The Last 12 Months Of Insider Transactions At PNC Financial Services Group

The Chairman & CEO, William Demchak, made the biggest insider sale in the last 12 months. That single transaction was for US$12m worth of shares at a price of US$231 each. That means that an insider was selling shares at slightly below the current price (US$254). 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 8.2% of William Demchak's holding.

In total, PNC Financial Services Group insiders sold more than they bought over the last year. 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 PNC Financial Services Group

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Insider Ownership Of PNC Financial Services Group

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It's great to see that PNC Financial Services Group insiders own 0.4% of the company, worth about US$366m. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

What Might The Insider Transactions At PNC Financial Services Group Tell Us?

Insiders sold PNC Financial Services Group shares recently, but they didn't buy any. Despite some insider buying, the longer term picture doesn't make us feel much more positive. But since PNC Financial Services Group is profitable and growing, we're not too worried by this. It is good to see high insider ownership, but the insider selling leaves us cautious. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing PNC Financial Services Group. In terms of investment risks, we've identified 1 warning sign with PNC Financial Services Group and understanding it should be part of your investment process.

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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.