In the last year, many PepsiCo, Inc. (NASDAQ:PEP) insiders sold a substantial stake in the company which may have sparked shareholders’ attention. 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.
View our latest analysis for PepsiCo
In the last twelve months, the biggest single sale by an insider was when the insider, Eugene Willemsen, sold US$1.3m worth of shares at a price of US$170 per share. While we don’t usually like to see insider selling, it’s more concerning if the sales take place at a lower price. The good news is that this large sale was at well above current price of US$152. So it may not tell us anything about how insiders feel about the current share price.
Insiders in PepsiCo didn’t buy any shares in the last year. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!
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).
I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. It’s great to see that PepsiCo insiders own 0.1% of the company, worth about US$284m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
The fact that there have been no PepsiCo insider transactions recently certainly doesn’t bother us. While we feel good about high insider ownership of PepsiCo, we can’t say the same about the selling of shares. So these insider transactions can help us build a thesis about the stock, but it’s also worthwhile knowing the risks facing this company. Case in point: We’ve spotted 2 warning signs for PepsiCo you should be aware of.
If you would prefer to check out another company — one with potentially superior financials — then do not miss this free list of interesting companies, that have HIGH return on equity and low debt.