Don't Ignore The Insider Selling In TMC the metals

Some TMC the metals company Inc. (NASDAQ:TMC) shareholders may be a little concerned to see that the Chief Development Officer, Anthony O'Sullivan, recently sold a substantial US$664k worth of stock at a price of US$6.64 per share. That's a big disposal, and it decreased their holding size by 23%, which is notable but not too bad.

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The Last 12 Months Of Insider Transactions At TMC the metals

The Chief Strategy Officer, Erika Ilves, made the biggest insider sale in the last 12 months. That single transaction was for US$9.2m worth of shares at a price of US$5.77 each. That means that an insider was selling shares at slightly below the current price (US$7.80). When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. 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. It is worth noting that this sale was only 49% of Erika Ilves's holding.

Over the last year we saw more insider selling of TMC the metals shares, than buying. 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!

Check out our latest analysis for TMC the metals

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).

Insider Ownership Of TMC the metals

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 TMC the metals insiders own 13% of the company, worth about US$427m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Do The TMC the metals Insider Transactions Indicate?

Insiders haven't bought TMC the metals stock in the last three months, but there was some selling. Despite some insider buying, the longer term picture doesn't make us feel much more positive. 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 TMC the metals. To that end, you should learn about the 5 warning signs we've spotted with TMC the metals (including 2 which are significant).

Of course TMC the metals 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.