Anyone interested in SoundThinking, Inc. (NASDAQ:SSTI) should probably be aware that the CFO & Secretary, Alan Stewart, recently divested US$209k worth of shares in the company, at an average price of US$13.95 each. The eyebrow raising move amounted to a reduction of 12% in their holding.
SoundThinking Insider Transactions Over The Last Year
In fact, the recent sale by Alan Stewart was the biggest sale of SoundThinking shares made by an insider individual in the last twelve months, according to our records. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. The silver lining is that this sell-down took place above the latest price (US$12.48). So it may not shed much light on insider confidence at current levels.
In the last year SoundThinking insiders didn't buy any company stock. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
For those who like to find hidden gems this free list of small cap companies with recent insider purchasing, could be just the ticket.
Does SoundThinking Boast High Insider Ownership?
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. It appears that SoundThinking insiders own 14% of the company, worth about US$23m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.
So What Does This Data Suggest About SoundThinking Insiders?
Insiders haven't bought SoundThinking stock in the last three months, but there was some selling. And there weren't any purchases to give us comfort, over the last year. Insiders own shares, but we're still pretty cautious, given the history of sales. 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. While conducting our analysis, we found that SoundThinking has 2 warning signs and it would be unwise to ignore them.
Of course SoundThinking 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.
