Nasdaq
華爾街日報Ross Stores Insiders Sold US$9.9m Of Shares Suggesting Hesitancy
The fact that multiple Ross Stores, Inc. (NASDAQ:ROST) insiders offloaded a considerable amount of shares over the past year could have raised some eyebrows amongst investors. When analyzing insider transactions, it is usually more valuable to know whether insiders are buying versus knowing if they are selling, as the latter sends an ambiguous message. However, if numerous insiders are selling, shareholders should investigate more.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.
Ross Stores Insider Transactions Over The Last Year
In the last twelve months, the biggest single sale by an insider was when the CEO & Director, James Conroy, sold US$5.7m worth of shares at a price of US$146 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of US$183. 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. However, while insider selling is sometimes discouraging, it's only a weak signal. This single sale was just 20% of James Conroy's stake.
Ross Stores insiders didn't buy any shares 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!
See our latest analysis for Ross Stores
I will like Ross Stores better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.
Insiders At Ross Stores Have Sold Stock Recently
The last three months saw significant insider selling at Ross Stores. Specifically, President of Operations Stephen Brinkley ditched US$972k worth of shares in that time, and we didn't record any purchases whatsoever. Overall this makes us a bit cautious, but it's not the be all and end all.
Insider Ownership
Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. It's great to see that Ross Stores insiders own 2.2% of the company, worth about US$1.3b. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
So What Do The Ross Stores Insider Transactions Indicate?
An insider sold Ross Stores shares recently, but they didn't buy any. And there weren't any purchases to give us comfort, over the last year. But since Ross Stores 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. Of course, the future is what matters most. So if you are interested in Ross Stores, you should check out this free report on analyst forecasts for the company.
Of course Ross Stores 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.