Yahoo Finance With Advanced Micro Devices, Inc.'s (NASDAQ:AMD)) price down 11% this week, insiders might find some solace having sold US$4.1m worth of shares earlier this year.
By selling US$4.1m worth of Advanced Micro Devices, Inc. (NASDAQ:AMD) 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 cap plunged by US$14b after price dropped by 11% last week but insiders were able to limit their loss to an extent.
Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.
View our latest analysis for Advanced Micro Devices
The Last 12 Months Of Insider Transactions At Advanced Micro Devices
The insider, Forrest Norrod, made the biggest insider sale in the last 12 months. That single transaction was for US$4.1m worth of shares at a price of US$102 each. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. It's of some comfort that this sale was conducted at a price well above the current share price, which is US$67.96. So it may not shed much light on insider confidence at current levels. Forrest Norrod was the only individual insider to sell shares in the last twelve months.
You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Advanced Micro Devices Insiders Are Selling The Stock
The last quarter saw substantial insider selling of Advanced Micro Devices shares. In total, insider Forrest Norrod dumped US$4.1m 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 Advanced Micro Devices Boast High Insider Ownership?
For a common shareholder, it is worth checking how many shares are held by company insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Advanced Micro Devices insiders own 0.5% of the company, currently worth about US$560m based on the recent share price. 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 Advanced Micro Devices Tell Us?
An insider sold stock recently, but they haven't been buying. 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. While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. Every company has risks, and we've spotted 3 warning signs for Advanced Micro Devices you should know about.
But note: Advanced Micro Devices 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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