Lowe's Companies, Inc. (NYSE:LOW) insiders who sold US$5.7m worth of stock earlier this year are probably glad they did so as market cap slides to US$115b




  • In Business
  • 2022-09-27 11:01:23Z
  • By Simply Wall St.
 

Over the past year, insiders sold US$5.7m worth of Lowe's Companies, Inc. (NYSE:LOW) stock at an average price of US$215 per share allowing them to get the most out of their money. The company's market valuation decreased by US$5.6b after the stock price dropped 4.7% over the past week, but insiders were spared from painful losses.

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.

View our latest analysis for Lowe's Companies

Lowe's Companies Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the Executive Vice President of Merchandising, William Boltz, sold US$3.2m worth of shares at a price of US$216 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 silver lining is that this sell-down took place above the latest price (US$186). So it is hard to draw any strong conclusion from it.

Insiders in Lowe's Companies didn't buy any shares in the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

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).

Lowe's Companies Insiders Are Selling The Stock

The last three months saw significant insider selling at Lowe's Companies. In total, insiders sold US$5.7m 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 Lowe's Companies Boast High Insider Ownership?

Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. It appears that Lowe's Companies insiders own 0.08% of the company, worth about US$88m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Do The Lowe's Companies Insider Transactions Indicate?

Insiders sold Lowe's Companies shares recently, but they didn't buy any. Looking to the last twelve months, our data doesn't show any insider buying. On the plus side, Lowe's Companies makes money, and is growing profits. Insiders own shares, but we're still pretty cautious, given the history of sales. We're in no rush to buy! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Lowe's Companies. To that end, you should learn about the 3 warning signs we've spotted with Lowe's Companies (including 1 which is potentially serious).

But note: Lowe's Companies 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.

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.

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