Selling US$1.8m Of Stock Was Lucrative Decision For BlackSky Technology Insiders

While BlackSky Technology Inc. (NYSE:BKSY) shareholders have enjoyed a good week with stock up 10%, they need remain vigilant. The fact that insiders chose to dispose of US$1.8m worth of stock in the past 12 months even though prices were relatively low could be indicative of some anticipated weakness.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

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BlackSky Technology Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the CEO, President & Director, Brian O’Toole, sold US$550k worth of shares at a price of US$17.45 per share. That means that an insider was selling shares at slightly below the current price (US$18.29). 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. 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. We note that the biggest single sale was only 7.8% of Brian O’Toole's holding.

Insiders in BlackSky Technology didn't buy any shares in the last year. 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 BlackSky Technology

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BlackSky Technology Insiders Are Selling The Stock

Over the last three months, we've seen significant insider selling at BlackSky Technology. In total, insiders dumped US$1.5m worth of shares in that time, and we didn't record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.

Insider Ownership Of BlackSky Technology

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. BlackSky Technology insiders own about US$28m worth of shares. That equates to 4.2% of the company. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Does This Data Suggest About BlackSky Technology Insiders?

Insiders haven't bought BlackSky Technology stock in the last three months, but there was some selling. And even if we look at the last year, we didn't see any purchases. Insiders own shares, but we're still pretty cautious, given the history of sales. We'd practice some caution before buying! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing BlackSky Technology. While conducting our analysis, we found that BlackSky Technology has 4 warning signs and it would be unwise to ignore them.

But note: BlackSky Technology 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.