Some Sea World Entertainment (NYSE ticker: SEAS) Shareholders may be a little concerned after seeing that independent director William Gray recently sold a substantial $1.2 million worth of stock at $60.23 each. That sale slashed 40% of their total holdings, which is almost insignificant, but far from the worst we’ve seen.
SeaWorld Entertainment’s insider transactions over the last 12 months
Chief Legal Officer George Taylor made the biggest insider trade of the past 12 months. A single transaction bought $2.8 million worth of stock at $53.04 per share. That means an insider sold the stock at a little below the current price ($58.62). When insiders sell for less than the current price, it’s a sign that they think the lower price is fair. This makes us wonder how they feel about the recent (higher) valuation. While an insider sale is not a positive sign, we can’t be sure if it means insiders believe the stock is fully valued, so it’s only a weak sign. We note that the largest single transaction represented only 32% of George Taylor’s stake.
In the past 12 months, insiders bought 47.95 million shares for $2.5 million. But insiders sold 96,980 shares worth $5.4 million. All told, insiders sold more SeaWorld Entertainment shares than they bought last year. The chart below shows insider trading by company and individual over the past year. By clicking on the image below, you can see the exact details of each insider transaction!
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Does SeaWorld Entertainment have high insider ownership?
Another way to test the alignment between a company’s leaders and other shareholders is to look at how many shares they own. In general, the higher the insider ownership, the more likely the insiders will be motivated to build the company over the long term. SeaWorld Entertainment insiders appear to own a 0.9 percent stake in the company, worth about $35 million. We’ve certainly seen higher levels of insider ownership elsewhere, but these are enough to indicate alignment between insiders and other shareholders.
So what do these numbers tell SeaWorld Entertainment insiders?
Insiders have sold shares recently, but they haven’t been buying. Despite some insider buying, the long-term outlook doesn’t make us any more optimistic. On the plus side, SeaWorld Entertainment is making money and growing. While insiders do own shares, they don’t own a lot of shares, and they’ve been selling. We use caution before buying! So while it’s helpful to know what insiders are doing when it comes to buying and selling, it’s also helpful to know what risks a particular company faces.Case in point: we found 2 Warning Signs of SeaWorld Entertainment You should know.
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For the purposes of this article, an insider is an individual who reports their transactions to the relevant regulator. We currently consider open market transactions and private dispositions, but not derivatives transactions.
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This article by Simply Wall St is general in nature. We use only an unbiased methodology to provide reviews based on historical data and analyst forecasts, and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock and does not take into account your objectives or your financial situation. Our goal is to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not take into account the latest price-sensitive company announcements or qualitative material. Simply Wall St has no positions in any of the stocks mentioned.