Senior VP of IBM Software & Chief Commercial Officer Robert Thomas Sold A Bunch Of Shares In International Business Machines
We wouldn't blame International Business Machines Corporation (NYSE:IBM) shareholders if they were a little worried about the fact that Robert Thomas, the Senior VP of IBM Software & Chief Commercial Officer recently netted about US$5.8m selling shares at an average price of US$230. That's a big disposal, and it decreased their holding size by 28%, which is notable but not too bad.
International Business Machines Insider Transactions Over The Last Year
In fact, the recent sale by Robert Thomas was the biggest sale of International Business Machines shares made by an insider individual in the last twelve months, according to our records. So it's clear an insider wanted to take some cash off the table, even below the current price of US$236. As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower 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. This single sale was just 28% of Robert Thomas's stake.
Happily, we note that in the last year insiders paid US$417k for 1.48k shares. But insiders sold 25.00k shares worth US$5.8m. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
See our latest analysis for International Business Machines
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Insider Ownership
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. We usually like to see fairly high levels of insider ownership. International Business Machines insiders own 0.09% of the company, currently worth about US$199m based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
What Might The Insider Transactions At International Business Machines Tell Us?
An insider sold International Business Machines shares recently, but they didn't buy any. Zooming out, the longer term picture doesn't give us much comfort. But it is good to see that International Business Machines is growing earnings. While insiders do own a lot of shares in the company (which is good), our analysis of their transactions doesn't make us feel confident about the company. While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. Case in point: We've spotted 2 warning signs for International Business Machines you should be aware of.
Of course International Business Machines may not be the best stock to buy. So you may wish to see this free collection of high quality companies.
For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently account for open market transactions and private dispositions of direct interests only, but not derivative transactions or indirect interests.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology 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 account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.