Some AutoNation, Inc. (NYSE:AN) shareholders may be a little concerned to see that the Senior VP & Chief Accounting Officer, Kimberly Dees, recently sold a substantial US$512k worth of stock at a price of US$205 per share. Probably the most concerning element of the whole transaction is that the disposal amounted to 63% of their entire holding.

AutoNation Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the insider, Edward Lampert, sold US$88m worth of shares at a price of US$201 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of US$206. 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 18% of Edward Lampert's stake.

Insiders in AutoNation 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!

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

Does AutoNation Boast High Insider Ownership?

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. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Insiders own 1.3% of AutoNation shares, worth about US$90m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

What Might The Insider Transactions At AutoNation Tell Us?

An insider hasn't bought AutoNation stock in the last three months, but there was some selling. And even if we look at the last year, we didn't see any purchases. But it is good to see that AutoNation is growing earnings. Insiders own shares, but we're still pretty cautious, given the history of sales. We're in no rush to buy! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing AutoNation.

But note: AutoNation 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.