Some Watts Water Technologies, Inc. (NYSE:WTS) shareholders may be a little concerned to see that insider Timothy Horne recently sold a substantial US$1.9m worth of stock at a price of US$279 per share. That's a big disposal, and it decreased their holding size by 23%, which is notable but not too bad.

The Last 12 Months Of Insider Transactions At Watts Water Technologies

In the last twelve months, the biggest single sale by an insider was when the insider, Shashank Patel, sold US$2.0m worth of shares at a price of US$245 per share. That means that even when the share price was below the current price of US$270, an insider wanted to cash in some shares. 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. However, while insider selling is sometimes discouraging, it's only a weak signal. It is worth noting that this sale was 74% of Shashank Patel's holding.

Insiders in Watts Water Technologies didn't buy any shares in 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!

I will like Watts Water Technologies better if I see some big insider buys.

Does Watts Water Technologies Boast High Insider Ownership?

Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Watts Water Technologies insiders own about US$1.7b worth of shares (which is 19% 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 Watts Water Technologies Tell Us?

Insiders haven't bought Watts Water Technologies stock in the last three months, but there was some selling. And there weren't any purchases to give us comfort, over the last year. But it is good to see that Watts Water Technologies is growing earnings. It is good to see high insider ownership, but the insider selling leaves us cautious. While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. While conducting our analysis, we found that Watts Water Technologies has 1 warning sign and it would be unwise to ignore this.

But note: Watts Water Technologies 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.