Yahoo Finance As Morgan Stanley's (NYSE:MS)) market cap dropped by US$7.3b, insiders who sold US$14m worth of stock were able to offset their losses
By selling US$14m worth of Morgan Stanley (NYSE:MS) stock at an average sell price of US$102 over the last year, insiders seemed to have made the most of their holdings. The company's market valuation decreased by US$7.3b after the stock price dropped 4.6% over the past week, but insiders were spared from painful losses.
Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.
Check out our latest analysis for Morgan Stanley
The Last 12 Months Of Insider Transactions At Morgan Stanley
Over the last year, we can see that the biggest insider sale was by the insider, Eric Grossman, for US$3.4m worth of shares, at about US$102 per share. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. The good news is that this large sale was at well above current price of US$88.69. So it may not tell us anything about how insiders feel about the current share price.
All up, insiders sold more shares in Morgan Stanley than they bought, over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!
I will like Morgan Stanley better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.
Insider Ownership Of Morgan Stanley
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. I reckon it's a good sign if insiders own a significant number of shares in the company. Morgan Stanley insiders own about US$398m worth of shares (which is 0.3% of the company). 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 Morgan Stanley Insider Transactions Indicate?
There haven't been any insider transactions in the last three months -- that doesn't mean much. While we feel good about high insider ownership of Morgan Stanley, we can't say the same about the selling of shares. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Every company has risks, and we've spotted 1 warning sign for Morgan Stanley you should know about.
But note: Morgan Stanley 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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