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Many McDonald's Corporation (NYSE:MCD) insiders ditched their stock over the past year, which may be of interest to the company's shareholders. When analyzing insider transactions, it is usually more valuable to know whether insiders are buying versus knowing if they are selling, as the latter sends an ambiguous message. However, if numerous insiders are selling, shareholders should investigate more.
While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.
See our latest analysis for McDonald's
The Last 12 Months Of Insider Transactions At McDonald's
Over the last year, we can see that the biggest insider sale was by the Chairman & CEO, Christopher Kempczinski, for US$5.5m worth of shares, at about US$300 per share. That means that an insider was selling shares at around the current price of US$290. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. Given that the sale took place at around current prices, it makes us a little cautious but is hardly a major concern.
In the last year McDonald's 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!
If you are like me, then you will not want to miss this free list of small cap stocks that are not only being bought by insiders but also have attractive valuations.
Insiders At McDonald's Have Sold Stock Recently
Over the last three months, we've seen significant insider selling at McDonald's. In total, insiders dumped US$2.7m 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
For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. McDonald's insiders own 0.06% of the company, currently worth about US$115m based on the recent share price. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
What Might The Insider Transactions At McDonald's Tell Us?
Insiders haven't bought McDonald's 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. On the plus side, McDonald's makes money, and is growing profits. It is good to see high insider ownership, but the insider selling leaves us cautious. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing McDonald's. To assist with this, we've discovered 2 warning signs that you should run your eye over to get a better picture of McDonald's.