We wouldn't blame Centene Corporation (NYSE:CNC) shareholders if they were a little worried about the fact that Kenneth Burdick, the Director recently netted about US$5.2m selling shares at an average price of US$64.55. That sale reduced their total holding by 22% which is hardly insignificant, but far from the worst we've seen.

The Last 12 Months Of Insider Transactions At Centene

In fact, the recent sale by Kenneth Burdick was the biggest sale of Centene shares made by an insider individual in the last twelve months, according to our records. That means that an insider was selling shares at below the current price (US$65.19). 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. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. We note that the biggest single sale was only 22% of Kenneth Burdick's holding.

Over the last year, we can see that insiders have bought 28.23k shares worth US$739k. But insiders sold 146.01k shares worth US$7.7m. Kenneth Burdick divested 146.01k shares over the last 12 months at an average price of US$53.01. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

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).

Insider Ownership Of Centene

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. It's great to see that Centene insiders own 0.4% of the company, worth about US$122m. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Do The Centene Insider Transactions Indicate?

An insider sold Centene shares recently, but they didn't buy any. And our longer term analysis of insider transactions didn't bring confidence, either. It is good to see high insider ownership, but the insider selling leaves us cautious. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company.

But note: Centene 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.