Don't Ignore The Insider Selling In Global Industrial

We'd be surprised if Global Industrial Company (NYSE:GIC) shareholders haven't noticed that the Senior VP & Chief Sales Officer, Claudia Hughes, recently sold US$189k worth of stock at US$39.78 per share. That sale was 21% of their holding, so it does make us raise an eyebrow.

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Global Industrial Insider Transactions Over The Last Year

The insider, Christopher Longhito, made the biggest insider sale in the last 12 months. That single transaction was for US$233k worth of shares at a price of US$31.46 each. That means that even when the share price was below the current price of US$38.66, an insider wanted to cash in some shares. As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. It is worth noting that this sale was 100% of Christopher Longhito's holding.

Insiders in Global Industrial didn't buy any shares in 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 Global Industrial

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Insider Ownership Of Global Industrial

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. Global Industrial insiders own 17% of the company, currently worth about US$248m 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.

What Might The Insider Transactions At Global Industrial Tell Us?

Insiders sold stock recently, but they haven't been buying. And there weren't any purchases to give us comfort, over the last year. On the plus side, Global Industrial makes money, and is growing profits. It is good to see high insider ownership, but the insider selling leaves us cautious. Therefore, you should definitely take a look at this FREE report showing analyst forecasts for Global Industrial.

But note: Global Industrial 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.

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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.