Over the past year, many Blackstone Inc. (NYSE:BX) insiders sold a significant stake in the company which may have piqued investors' interest. When evaluating insider transactions, knowing whether insiders are buying versus if they selling is usually more beneficial, as the latter can be open to many interpretations. However, when multiple insiders sell stock over a specific duration, shareholders should take notice as that could possibly be a red flag.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.
Blackstone Insider Transactions Over The Last Year
The Chief Legal Officer, John Finley, made the biggest insider sale in the last 12 months. That single transaction was for US$5.4m worth of shares at a price of US$108 each. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. The silver lining is that this sell-down took place above the latest price (US$83.94). So it may not shed much light on insider confidence at current levels.
Happily, we note that in the last year insiders paid US$3.6m for 38.18k shares. But they sold 119.52k shares for US$13m. All up, insiders sold more shares in Blackstone than they bought, over the last year. The average sell price was around US$107. It is certainly not great to see that insiders have sold shares in the company. However, we do note that the average sale price was significantly higher than the current share price (which is US$83.94). 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!
If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.
Insiders At Blackstone Have Sold Stock Recently
There was substantially more insider selling, than buying, of Blackstone shares over the last three months. We note Chief Legal Officer John Finley cashed in US$4.0m worth of shares. On the other hand we note insider Ruth Porat bought US$33k worth of shares. Generally this level of net selling might be considered a bit bearish.
Does Blackstone Boast High 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. Blackstone insiders own 0.2% of the company, currently worth about US$162m based on the recent share price. 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 Does This Data Suggest About Blackstone Insiders?
The stark truth for Blackstone is that there has been more insider selling than insider buying in the last three months. And our longer term analysis of insider transactions didn't bring confidence, either. While insiders do own a lot of shares in the company (which is good), our analysis of their transactions doesn't make us feel confident about the company. While we like knowing 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 3 warning signs for Blackstone you should know about.
But note: Blackstone 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, but not derivative transactions.
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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.
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