Advertisement
New Zealand markets open in 20 minutes
  • NZX 50

    11,741.88
    -43.60 (-0.37%)
     
  • NZD/USD

    0.6189
    +0.0044 (+0.72%)
     
  • ALL ORDS

    7,963.10
    -42.80 (-0.53%)
     
  • OIL

    78.32
    +0.42 (+0.54%)
     
  • GOLD

    2,340.70
    +14.10 (+0.61%)
     

Possible bearish signals as United Parcel Service, Inc. (NYSE:UPS) insiders disposed of US$16m worth of stock

The fact that multiple United Parcel Service, Inc. (NYSE:UPS) insiders offloaded a considerable amount of shares over the past year could have raised some eyebrows amongst investors. When evaluating insider transactions, knowing whether insiders are buying versus if they selling is usually more beneficial, as the latter can be open to many interpretations. However, when multiple insiders sell stock over a specific duration, shareholders should take notice as that could possibly be a red flag.

Although we don't think shareholders should simply follow insider transactions, logic dictates you should pay some attention to whether insiders are buying or selling shares.

View our latest analysis for United Parcel Service

The Last 12 Months Of Insider Transactions At United Parcel Service

The Executive VP and President of International, Kathleen Gutmann, made the biggest insider sale in the last 12 months. That single transaction was for US$10m worth of shares at a price of US$190 each. So what is clear is that an insider saw fit to sell at around the current price of US$186. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. In this case, the big sale took place at around the current price, so it's not too bad (but it's still not a positive).

ADVERTISEMENT

United Parcel Service insiders didn't buy any shares 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!

insider-trading-volume
insider-trading-volume

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: insiders have been buying them).

United Parcel Service Insiders Are Selling The Stock

Over the last three months, we've seen significant insider selling at United Parcel Service. In total, insiders sold US$14m 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 United Parcel Service Boast High Insider Ownership?

For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. United Parcel Service insiders own 0.07% of the company, currently worth about US$114m 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 United Parcel Service Insider Transactions Indicate?

Insiders sold stock recently, but they haven't been buying. Looking to the last twelve months, our data doesn't show any insider buying. 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. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. At Simply Wall St, we've found that United Parcel Service has 3 warning signs (1 can't be ignored!) that deserve your attention before going any further with your analysis.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.

Join A Paid User Research Session
You’ll receive a US$30 Amazon Gift card for 1 hour of your time while helping us build better investing tools for the individual investors like yourself. Sign up here