Some CCL Industries Inc. (TSE:CCL.B) shareholders may be a little concerned to see that the President, Geoffrey Martin, recently sold a substantial CA$1.7m worth of stock at a price of CA$84.04 per share. However, it's crucial to note that they remain very much invested in the stock and that sale only reduced their holding by 2.9%.
The Senior Vice President of Finance, Lalitha Vaidyanathan, made the biggest insider sale in the last 12 months. That single transaction was for CA$3.1m worth of shares at a price of CA$81.07 each. That means that an insider was selling shares at slightly below the current price (CA$85.72). We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. However, while insider selling is sometimes discouraging, it's only a weak signal. This single sale was just 27% of Lalitha Vaidyanathan's stake.
Insiders in CCL Industries didn't buy any shares in the last year. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
View our latest analysis for CCL Industries
I will like CCL Industries better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It appears that CCL Industries insiders own 0.9% of the company, worth about CA$129m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
Insiders sold CCL Industries shares recently, but they didn't buy any. And even if we look at the last year, we didn't see any purchases. But it is good to see that CCL Industries is growing earnings. 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 it's good to be aware of 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. In terms of investment risks, we've identified 1 warning sign with CCL Industries and understanding it should be part of your investment process.
Of course CCL Industries may not be the best stock to buy. So you may wish to see this free collection of high quality companies.
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 of direct interests only, but not derivative transactions or indirect interests.
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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.