Yahoo Finance Chipotle Mexican Grill Insiders Sold US$42m Of Shares Suggesting Hesitancy
In the last year, many Chipotle Mexican Grill, Inc. (NYSE:CMG) insiders sold a substantial stake in the company which may have sparked shareholders' attention. Knowing whether insiders are buying is usually more helpful when evaluating insider transactions, as insider selling can have various explanations. 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 Chipotle Mexican Grill
Chipotle Mexican Grill Insider Transactions Over The Last Year
In fact, the recent sale by Brian Niccol was the biggest sale of Chipotle Mexican Grill shares made by an insider individual in the last twelve months, according to our records. So we know that an insider sold shares at around the present share price of US$3,155. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. We note that this sale took place at around the current price, so it isn't a major concern, though it's hardly a good sign.
All up, insiders sold more shares in Chipotle Mexican Grill than they bought, over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!
I will like Chipotle Mexican Grill better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.
Insiders At Chipotle Mexican Grill Have Sold Stock Recently
The last three months saw significant insider selling at Chipotle Mexican Grill. Specifically, insiders ditched US$37m 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.
Does Chipotle Mexican Grill 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. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Chipotle Mexican Grill insiders own 0.7% of the company, currently worth about US$569m 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 Chipotle Mexican Grill Insiders?
Insiders sold Chipotle Mexican Grill shares recently, but they didn't buy any. And our longer term analysis of insider transactions didn't bring confidence, either. But since Chipotle Mexican Grill is profitable and growing, we're not too worried by this. 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 Chipotle Mexican Grill. Case in point: We've spotted 1 warning sign for Chipotle Mexican Grill you should be aware of.
But note: Chipotle Mexican Grill 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 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.
