Yahoo Finance Kinder Morgan Insiders Sold US$4.7m Of Shares Suggesting Hesitancy
Many Kinder Morgan, Inc. (NYSE:KMI) insiders ditched their stock over the past year, which may be of interest to the company's shareholders. 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, if numerous insiders are selling, shareholders should investigate more.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.
Check out our latest analysis for Kinder Morgan
The Last 12 Months Of Insider Transactions At Kinder Morgan
The Independent Lead Director, Michael Morgan, made the biggest insider sale in the last 12 months. That single transaction was for US$1.3m worth of shares at a price of US$18.82 each. That means that even when the share price was below the current price of US$20.10, an insider wanted to cash in some shares. As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. However, while insider selling is sometimes discouraging, it's only a weak signal. It is worth noting that this sale was only 16% of Michael Morgan's holding.
In the last year Kinder Morgan insiders didn't buy any company stock. 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!
For those who like to find hidden gems this free list of small cap companies with recent insider purchasing, could be just the ticket.
Kinder Morgan Insiders Are Selling The Stock
The last quarter saw substantial insider selling of Kinder Morgan shares. In total, insiders sold US$2.3m 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
I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. We usually like to see fairly high levels of insider ownership. Kinder Morgan insiders own about US$5.6b worth of shares (which is 13% of the company). 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 Kinder Morgan Tell Us?
Insiders sold Kinder Morgan shares recently, but they didn't buy any. And there weren't any purchases to give us comfort, over the last year. 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. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Kinder Morgan. To that end, you should learn about the 3 warning signs we've spotted with Kinder Morgan (including 2 which don't sit too well with us).
Of course Kinder Morgan 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.
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