Yahoo Finance More money in the bank for insiders who divested US$106m worth of Salesforce, Inc. (NYSE:CRM) shares last year
Last week, Salesforce, Inc.'s (NYSE:CRM) stock jumped 4.0%, but insiders who sold US$106m worth of stock in over the past year are likely to be in a better position. Selling at an average price of US$173, which is higher than the current price, may have been the best move for these insiders because their investment would have been worth less now than when they sold.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.
See our latest analysis for Salesforce
Salesforce Insider Transactions Over The Last Year
In the last twelve months, the biggest single sale by an insider was when the Co-Founder, Marc Benioff, sold US$53m worth of shares at a price of US$182 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. The good news is that this large sale was at well above current price of US$156. So it is hard to draw any strong conclusion from it.
Insiders in Salesforce didn't buy any shares in 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 are like me, then you will not want to miss this free list of growing companies that insiders are buying.
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. Salesforce insiders own 3.1% of the company, currently worth about US$4.9b 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 Do The Salesforce Insider Transactions Indicate?
The fact that there have been no Salesforce insider transactions recently certainly doesn't bother us. It's heartening that insiders own plenty of stock, but we'd like to see more insider buying, since the last year of Salesforce insider transactions don't fill us with confidence. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. In terms of investment risks, we've identified 3 warning signs with Salesforce and understanding these should be part of your investment process.
But note: Salesforce 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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