Yahoo Finance Johnson & Johnson Insiders Sell US$6.8m Of Stock, Possibly Signalling Caution
The fact that multiple Johnson & Johnson (NYSE:JNJ) 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, when multiple insiders sell stock over a specific duration, shareholders should take notice as that could possibly be a red flag.
Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.
View our latest analysis for Johnson & Johnson
Johnson & Johnson Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider sale was by the Executive VP & Chief Human Resources Officer, Peter Fasolo, for US$3.4m worth of shares, at about US$170 per share. While we don't usually like to see insider selling, it's more concerning if the sales take place 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$155. So it may not tell us anything about how insiders feel about the current share price.
Insiders in Johnson & Johnson didn't buy any shares in the last year. The chart below shows insider transactions (by companies and individuals) over the last year. 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: Most of them are flying under the radar).
Insiders At Johnson & Johnson Have Sold Stock Recently
The last three months saw significant insider selling at Johnson & Johnson. Specifically, insider Vanessa Broadhurst ditched US$1.4m worth of shares in that time, and we didn't record any purchases whatsoever. In light of this it's hard to argue that all the insiders think that the shares are a bargain.
Does Johnson & Johnson Boast High Insider Ownership?
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. I reckon it's a good sign if insiders own a significant number of shares in the company. Johnson & Johnson insiders own 0.08% of the company, currently worth about US$280m based on the recent share price. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.
So What Does This Data Suggest About Johnson & Johnson Insiders?
An insider hasn't bought Johnson & Johnson stock in the last three months, but there was some selling. And even if we look at the last year, we didn't see any purchases. But since Johnson & Johnson 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. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Johnson & Johnson. Every company has risks, and we've spotted 2 warning signs for Johnson & Johnson 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.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
