Anyone interested in LivePerson, Inc. (NASDAQ:LPSN) should probably be aware that the CFO, COO, John Collins, recently divested US$111k worth of shares in the company, at an average price of US$0.85 each. Equally important, that sale actually reduced their holding by a full 66% which hardly makes us feel bullish about the stock.

The Last 12 Months Of Insider Transactions At LivePerson

In fact, the recent sale by John Collins was the biggest sale of LivePerson shares made by an insider individual in the last twelve months, according to our records. That means that even when the share price was below the current price of US$0.95, an insider wanted to cash in some shares. 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. 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. It is worth noting that this sale was 66% of John Collins's holding.

Happily, we note that in the last year insiders paid US$105k for 105.00k shares. But they sold 461.05k shares for US$442k. All up, insiders sold more shares in LivePerson than they bought, over the last year. 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!

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Insider Ownership Of LivePerson

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. A high insider ownership often makes company leadership more mindful of shareholder interests. Our data suggests LivePerson insiders own 3.2% of the company, worth about US$2.7m. I generally like to see higher levels of ownership.

What Might The Insider Transactions At LivePerson Tell Us?

Insiders haven't bought LivePerson stock in the last three months, but there was some selling. Zooming out, the longer term picture doesn't give us much comfort. When you combine this with the relatively low insider ownership, we are very cautious about the stock. So we'd only buy after very careful consideration. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing LivePerson.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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.