We wouldn't blame American Financial Group, Inc. (NYSE:AFG) shareholders if they were a little worried about the fact that David Thompson, the President & COO of Property and Casualty Insurance Group and Director recently netted about US$1.5m selling shares at an average price of US$135. However, it's crucial to note that they remain very much invested in the stock and that sale only reduced their holding by 0.7%.
American Financial Group Insider Transactions Over The Last Year
Notably, that recent sale by David Thompson is the biggest insider sale of American Financial Group shares that we've seen in the last year. That means that an insider was selling shares at slightly below the current price (US$141). 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. 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. It is worth noting that this sale was only 0.7% of David Thompson's holding.
In the last year American Financial Group insiders didn't buy any company stock. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
See our latest analysis for American Financial Group
I will like American Financial Group 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.
Insider Ownership Of American Financial Group
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. American Financial Group insiders own about US$1.3b worth of shares (which is 11% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.
What Might The Insider Transactions At American Financial Group Tell Us?
Insiders haven't bought American Financial Group stock in the last three months, but there was some selling. And even if we look at the last year, we didn't see any purchases. On the plus side, American Financial Group makes money, and is growing profits. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. You'd be interested to know, that we found 2 warning signs for American Financial Group and we suggest you have a look.
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.
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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.