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Many The Charles Schwab Corporation (NYSE:SCHW) insiders ditched their stock over the past year, which may be of interest to the company's shareholders. Knowing whether insiders are buying is usually more helpful when evaluating insider transactions, as insider selling can have various explanations. However, shareholders should take a deeper look if several insiders are selling stock over a specific time period.
While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.
See our latest analysis for Charles Schwab
The Last 12 Months Of Insider Transactions At Charles Schwab
In the last twelve months, the biggest single sale by an insider was when the Founder & Co-Chairman, Charles Schwab, sold US$19m worth of shares at a price of US$69.43 per share. That means that an insider was selling shares at slightly below the current price (US$83.26). When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent 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. This single sale was just 0.2% of Charles Schwab's stake.
In total, Charles Schwab insiders sold more 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!
If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.
Charles Schwab Insiders Are Selling The Stock
Over the last three months, we've seen significant insider selling at Charles Schwab. Specifically, insiders ditched US$46m worth of shares in that time, and we didn't record any purchases whatsoever. In light of this it's hard to argue that all the insiders think that the shares are a bargain.
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. A high insider ownership often makes company leadership more mindful of shareholder interests. Charles Schwab insiders own about US$9.9b worth of shares (which is 6.4% of the company). Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.