We wouldn't blame Cummins Inc. (NYSE:CMI) shareholders if they were a little worried about the fact that William Miller, the Independent Director recently netted about US$11m selling shares at an average price of US$597. That sale reduced their total holding by 34% which is hardly insignificant, but far from the worst we've seen.

The Last 12 Months Of Insider Transactions At Cummins

Notably, that recent sale by William Miller is the biggest insider sale of Cummins shares that we've seen in the last year. That means that an insider was selling shares at around the current price of US$601. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. Given that the sale took place at around current prices, it makes us a little cautious but is hardly a major concern.

Over the last year we saw more insider selling of Cummins shares, than buying. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

I will like Cummins better if I see some big insider buys.

Does Cummins Boast High Insider Ownership?

Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. Cummins insiders own about US$247m worth of shares (which is 0.3% of the company). Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Do The Cummins Insider Transactions Indicate?

An insider hasn't bought Cummins stock in the last three months, but there was some selling. Despite some insider buying, the longer term picture doesn't make us feel much more positive. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. Of course, the future is what matters most.

Of course Cummins 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.

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.