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Many Berkshire Hathaway Inc. (NYSE:BRK.A) 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 would consider it foolish to ignore insider transactions altogether.
Check out our latest analysis for Berkshire Hathaway
The Last 12 Months Of Insider Transactions At Berkshire Hathaway
In the last twelve months, the biggest single sale by an insider was when the Vice Chairman of Insurance Operations & Director, Ajit Jain, sold US$139m worth of shares at a price of US$695,418 per share. That means that an insider was selling shares at below the current price (US$702,760). We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. It is worth noting that this sale was 63% of Ajit Jain's holding.
In the last year Berkshire Hathaway insiders didn't buy any company stock. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. 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.
Berkshire Hathaway Insiders Are Selling The Stock
Over the last three months, we've seen significant insider selling at Berkshire Hathaway. In total, Independent Director Charlotte Guyman dumped US$678k worth of shares in that time, and we didn't record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.
Insider Ownership
Many investors like to check how much of a company is owned by 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. Berkshire Hathaway insiders own 15% of the company, currently worth about US$147b based on the recent share price. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.