Some Flowers Foods, Inc. (NYSE:FLO) shareholders may be a little concerned to see that the CEO & Chairman of Board, A. McMullian, recently sold a substantial US$2.3m worth of stock at a price of US$10.87 per share. However, it's crucial to note that they remain very much invested in the stock and that sale only reduced their holding by 7.5%.

The Last 12 Months Of Insider Transactions At Flowers Foods

Notably, that recent sale by CEO & Chairman of Board A. McMullian was not the only time they sold Flowers Foods shares this year. Earlier in the year, they fetched US$12.83 per share in a -US$4.5m sale. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. The good news is that this large sale was at well above current price of US$10.72. So it is hard to draw any strong conclusion from it.

In the last twelve months insiders purchased 12.46k shares for US$207k. On the other hand they divested 562.60k shares, for US$6.8m. In total, Flowers Foods insiders sold more 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 Flowers Foods

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. Flowers Foods insiders own about US$170m worth of shares (which is 7.5% of the company). Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

What Might The Insider Transactions At Flowers Foods Tell Us?

The insider sales have outweighed the insider buying, at Flowers Foods, in the last three months. Zooming out, the longer term picture doesn't give us much comfort. While insiders do own a lot of shares in the company (which is good), our analysis of their transactions doesn't make us feel confident about the company. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Flowers Foods.

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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.