Yahoo Finance Insiders sold US$9.9m worth of The Goldman Sachs Group, Inc. (NYSE:GS) stock last year, could be a warning sign to watch out for
Despite a 7.6% gain in The Goldman Sachs Group, Inc.'s (NYSE:GS) stock price this week, shareholders shouldn't let up. The fact that insiders chose to dispose of US$9.9m worth of stock in the past 12 months even though prices were relatively low could be indicative of some anticipated weakness.
While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.
View our latest analysis for Goldman Sachs Group
The Last 12 Months Of Insider Transactions At Goldman Sachs Group
In the last twelve months, the biggest single sale by an insider was when the Chairman & CEO, David Solomon, sold US$3.3m worth of shares at a price of US$335 per share. That means that even when the share price was below the current price of US$385, an insider wanted to cash in some shares. 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 8.0% of David Solomon's holding.
Goldman Sachs Group 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 want to know exactly who sold, for how much, and when, simply click on the graph below!
If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: insiders have been buying them).
Goldman Sachs Group Insiders Are Selling The Stock
The last quarter saw substantial insider selling of Goldman Sachs Group shares. Specifically, Chairman & CEO David Solomon ditched US$2.5m 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
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. It's great to see that Goldman Sachs Group insiders own 0.5% of the company, worth about US$632m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
What Might The Insider Transactions At Goldman Sachs Group Tell Us?
An insider hasn't bought Goldman Sachs Group stock in the last three months, but there was some selling. Looking to the last twelve months, our data doesn't show any insider buying. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. 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. Case in point: We've spotted 2 warning signs for Goldman Sachs Group you should be aware of.
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, 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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