We wouldn't blame nVent Electric plc (NYSE:NVT) shareholders if they were a little worried about the fact that Aravind Padmanabhan, the Executive VP & CTO recently netted about US$1.2m selling shares at an average price of US$170. That sale reduced their total holding by 23% which is hardly insignificant, but far from the worst we've seen.
The Last 12 Months Of Insider Transactions At nVent Electric
Over the last year, we can see that the biggest insider sale was by the President of EMEA & APAC, Robert Van Der Kolk, for US$2.5m worth of shares, at about US$117 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of US$171. As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. However, while insider selling is sometimes discouraging, it's only a weak signal. This single sale was 53% of Robert Van Der Kolk's stake.
All up, insiders sold more shares in nVent Electric than they bought, over 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!
Check out our latest analysis for nVent Electric
I will like nVent Electric 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.
Does nVent Electric Boast High Insider Ownership?
Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. It's great to see that nVent Electric insiders own 0.4% of the company, worth about US$103m. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
What Might The Insider Transactions At nVent Electric Tell Us?
An insider sold nVent Electric shares recently, but they didn't buy any. Despite some insider buying, the longer term picture doesn't make us feel much more positive. On the plus side, nVent Electric makes money, and is growing profits. It is good to see high insider ownership, but the insider selling leaves us cautious. 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 1 warning sign for nVent Electric you should know about.
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 of direct interests only, but not derivative transactions or indirect interests.
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.