Some Burlington Stores, Inc. (NYSE:BURL) shareholders may be a little concerned to see that the EVP & Chief Human Resource Officer, Matthew Pasch, recently sold a substantial US$1.2m worth of stock at a price of US$317 per share. That diminished their holding by a very significant 50%, which arguably implies a strong desire to reallocate capital.

Burlington Stores Insider Transactions Over The Last Year

In fact, the recent sale by Matthew Pasch was the biggest sale of Burlington Stores 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$342. 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. However, while insider selling is sometimes discouraging, it's only a weak signal. It is worth noting that this sale was 50% of Matthew Pasch's holding.

In the last year Burlington Stores insiders didn't buy any company stock. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

I will like Burlington Stores better if I see some big insider buys.

Insider Ownership Of Burlington Stores

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Burlington Stores insiders own 0.5% of the company, currently worth about US$109m 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.

So What Does This Data Suggest About Burlington Stores Insiders?

Insiders sold Burlington Stores shares recently, but they didn't buy any. And even if we look at the last year, we didn't see any purchases. But it is good to see that Burlington Stores is growing earnings. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. To assist with this, we've discovered 1 warning sign that you should run your eye over to get a better picture of Burlington Stores.

But note: Burlington Stores may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.

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.