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While it’s been a great week for Accenture plc (NYSE:ACN) shareholders after stock gained 4.2%, company insiders might have missed out on those gains after selling stock earlier this year. The value of their investment would have been higher had they waited to sell their stock.
While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.
View our latest analysis for Accenture
Accenture Insider Transactions Over The Last Year
Notably, that recent sale by Paula Price is the biggest insider sale of Accenture shares that we've seen in the last year. So it's clear an insider wanted to take some cash off the table, even below the current price of US$266. 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. 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. It is worth noting that this sale was only 10% of Paula Price's holding.
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!
If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.
Accenture Insiders Are Selling The Stock
Over the last three months, we've seen significant insider selling at Accenture. In total, Independent Director Paula Price dumped US$194k worth of shares in that time, and we didn't record any purchases whatsoever. Overall this makes us a bit cautious, but it's not the be all and end all.
Does Accenture 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 Accenture insiders own 0.09% of the company, worth about US$155m. 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 Accenture Tell Us?
An insider hasn't bought Accenture 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. But since Accenture is profitable and growing, we're not too worried by this. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. While we like knowing 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. Case in point: We've spotted 1 warning sign for Accenture you should be aware of.