Over the past year, many KKR & Co. Inc. (NYSE:KKR) insiders sold a significant stake in the company which may have piqued investors’ interest. Knowing whether insiders are buying is usually more helpful when evaluating insider transactions, as insider selling can have various explanations. However, when multiple insiders sell stock over a specific duration, shareholders should take notice as that could possibly be a red flag.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.
Over the last year, we can see that the biggest insider sale was by the Co-Founder & Executive Co-Chairman, Henry Kravis, for US$154m worth of shares, at about US$122 per share. So it’s clear an insider wanted to take some cash off the table, even below the current price of US$132. 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. It is worth noting that this sale was only 1.6% of Henry Kravis’s holding.
Over the last year, we can see that insiders have bought 48.25k shares worth US$5.6m. But insiders sold 2.47m shares worth US$296m. In total, KKR insiders sold more than they bought over the last year. 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!
See our latest analysis for KKR
If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: Most of them are flying under the radar).
Over the last three months, we’ve seen notably more insider selling, than insider buying, at KKR. We note insiders cashed in US$296m worth of shares. Meanwhile insiders bought US$5.6m worth , as we said above . Because the selling vastly outweighs the buying, we’d say this is a somewhat bearish sign.
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. It’s great to see that KKR insiders own 23% of the company, worth about US$28b. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
