We wouldn't blame CNA Financial Corporation (NYSE:CNA) shareholders if they were a little worried about the fact that Elizabeth Aguinaga, the Executive VP & Chief Human Resources Officer recently netted about US$1.3m selling shares at an average price of US$49.60. That sale reduced their total holding by 35% which is hardly insignificant, but far from the worst we've seen.
The Last 12 Months Of Insider Transactions At CNA Financial
In fact, the recent sale by Elizabeth Aguinaga was the biggest sale of CNA Financial shares made by an insider individual in the last twelve months, according to our records. That means that an insider was selling shares at below the current price (US$50.00). 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. We note that the biggest single sale was only 35% of Elizabeth Aguinaga's holding.
In the last year CNA Financial 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 want to know exactly who sold, for how much, and when, simply click on the graph below!
I will like CNA Financial 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
For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 0.6% of CNA Financial shares, worth about US$84m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
So What Do The CNA Financial Insider Transactions Indicate?
Insiders sold CNA Financial 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 CNA Financial is growing earnings. Insider ownership isn't particularly high, so this analysis makes us cautious about the company. We're in no rush to buy! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. To assist with this, we've discovered 2 warning signs that you should run your eye over to get a better picture of CNA Financial.
Of course CNA Financial 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.
