Some The Chefs' Warehouse, Inc. (NASDAQ:CHEF) shareholders may be a little concerned to see that the Founder, Christopher Pappas, recently sold a substantial US$9.8m worth of stock at a price of US$78.00 per share. However, that sale only accounted for 5.3% of their holding, so arguably it doesn't say much about their conviction.
Chefs' Warehouse Insider Transactions Over The Last Year
Notably, that recent sale by Christopher Pappas is the biggest insider sale of Chefs' Warehouse shares that we've seen in the last year. That means that even when the share price was below the current price of US$80.34, an insider wanted to cash in some shares. 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. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. This single sale was just 5.3% of Christopher Pappas's stake.
Insiders in Chefs' Warehouse 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!
See our latest analysis for Chefs' Warehouse
If you are like me, then you will not want to miss this free list of small cap stocks that are not only being bought by insiders but also have attractive valuations.
Does Chefs' Warehouse 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. It's great to see that Chefs' Warehouse insiders own 10% of the company, worth about US$335m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
So What Does This Data Suggest About Chefs' Warehouse Insiders?
Insiders sold Chefs' Warehouse shares recently, but they didn't buy any. And there weren't any purchases to give us comfort, over the last year. On the plus side, Chefs' Warehouse makes money, and is growing profits. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. 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. Every company has risks, and we've spotted 2 warning signs for Chefs' Warehouse (of which 1 shouldn't be ignored!) you should know about.
But note: Chefs' Warehouse 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 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.