Don't Ignore The Insider Selling In Powell Industries
Some Powell Industries, Inc. (NASDAQ:POWL) shareholders may be a little concerned to see that the Chairman of the Board, Brett Cope, recently sold a substantial US$901k worth of stock at a price of US$188 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 1.0%.
The Last 12 Months Of Insider Transactions At Powell Industries
Over the last year, we can see that the biggest insider sale was by the insider, Thomas Powell, for US$30m worth of shares, at about US$294 per share. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. It's of some comfort that this sale was conducted at a price well above the current share price, which is US$196. So it is hard to draw any strong conclusion from it.
Powell Industries insiders didn't buy any shares over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!
Check out our latest analysis for Powell Industries
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 Powell Industries Boast High Insider Ownership?
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. A high insider ownership often makes company leadership more mindful of shareholder interests. Powell Industries insiders own about US$177m worth of shares (which is 2.5% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.
What Might The Insider Transactions At Powell Industries Tell Us?
Insiders sold Powell Industries shares recently, but they didn't buy any. And even if we look at the last year, we didn't see any purchases. But since Powell Industries 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. 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. Every company has risks, and we've spotted 1 warning sign for Powell Industries you should know about.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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.