We wouldn't blame Applied Materials, Inc. (NASDAQ:AMAT) shareholders if they were a little worried about the fact that Gary Dickerson, the President recently netted about US$49m selling shares at an average price of US$593. However, it's crucial to note that they remain very much invested in the stock and that sale only reduced their holding by 6.0%.

The Last 12 Months Of Insider Transactions At Applied Materials

In fact, the recent sale by Gary Dickerson was the biggest sale of Applied Materials 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$617, 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 only 6.0% of Gary Dickerson's holding.

Applied Materials insiders didn't buy any shares over the last year. 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!

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).

Does Applied Materials Boast High Insider Ownership?

Many investors like to check how much of a company is owned by insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Applied Materials insiders own 0.3% of the company, currently worth about US$1.4b based on the recent share price. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Does This Data Suggest About Applied Materials Insiders?

Insiders sold Applied Materials shares recently, but they didn't buy any. Looking to the last twelve months, our data doesn't show any insider buying. But it is good to see that Applied Materials is growing earnings. It is good to see high insider ownership, but the insider selling leaves us cautious. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. For example - Applied Materials has 1 warning sign we think you should be aware of.

But note: Applied Materials 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.