Some Microsoft Corporation (NASDAQ:MSFT) shareholders may be a little concerned to see that the Executive Vice President of Business Development, Margaret Johnson, recently sold a whopping US$5.3m worth of stock at a price of US$150 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 9.2%.
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The Last 12 Months Of Insider Transactions At Microsoft
The President & Chief Legal Officer, Bradford Smith, made the biggest insider sale in the last 12 months. That single transaction was for US$25m worth of shares at a price of US$130 each. That means that even when the share price was below the current price of US$151, an insider wanted to cash in some shares. When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. While insider selling is not a positive sign, we can’t be sure if it does mean insiders think the shares are fully valued, so it’s only a weak sign. This single sale was just 23% of Bradford Smith’s stake.
Over the last year, we note insiders sold 572733 shares worth US$77m. Microsoft insiders didn’t buy any shares over the last year. You can see the insider transactions (by 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!
I will like Microsoft 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 Microsoft
For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Microsoft insiders own 1.4% of the company, currently worth about US$16b 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 Microsoft Insider Transactions Indicate?
Insiders sold Microsoft shares recently, but they didn’t buy any. And there weren’t any purchases to give us comfort, over the last year. But since Microsoft is profitable and growing, we’re not too worried by this. The company boasts high insider ownership, but we’re a little hesitant, given the history of share sales. Of course, the future is what matters most. So if you are interested in Microsoft, you should check out this free report on analyst forecasts for the company.
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.
If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.
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