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From what we can see, insiders were net sellers in ResMed Inc.'s (NYSE:RMD ) during the past 12 months. That is, insiders sold the stock in greater numbers than they purchased it.
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.
The Last 12 Months Of Insider Transactions At ResMed
Over the last year, we can see that the biggest insider sale was by the Chief Product Officer, Justin Leong, for US$10m worth of shares, at about US$217 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of US$236. 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. However, while insider selling is sometimes discouraging, it's only a weak signal. It is worth noting that this sale was 72% of Justin Leong's holding. The only individual insider seller over the last year was Justin Leong.
Justin Leong divested 54.16k shares over the last 12 months at an average price of US$220. 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!
See our latest analysis for ResMed
I will like ResMed better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.
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 ResMed insiders own 0.5% of the company, worth about US$181m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
So What Does This Data Suggest About ResMed Insiders?
There haven't been any insider transactions in the last three months -- that doesn't mean much. It's great to see high levels of insider ownership, but looking back over the last year, we don't gain confidence from the ResMed insiders selling. Therefore, you should definitely take a look at this FREE report showing analyst forecasts for ResMed.