We wouldn't blame Ralph Lauren Corporation (NYSE:RL) shareholders if they were a little worried about the fact that Ralph Lauren, the Executive Chairman & Chief Creative Officer recently netted about US$100m selling shares at an average price of US$378. That diminished their holding by a very significant 88%, which arguably implies a strong desire to reallocate capital.

Ralph Lauren Insider Transactions Over The Last Year

Notably, that recent sale by Ralph Lauren is the biggest insider sale of Ralph Lauren shares that we've seen in the last year. So we know that an insider sold shares at around the present share price of US$364. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. We note that this sale took place at around the current price, so it isn't a major concern, though it's hardly a good sign.

In the last year Ralph Lauren insiders didn't buy any company stock. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

I will like Ralph Lauren better if I see some big insider buys.

Insider Ownership

For a common shareholder, it is worth checking how many shares are held by company 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. Ralph Lauren insiders own about US$7.3b worth of shares (which is 33% 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.

So What Do The Ralph Lauren Insider Transactions Indicate?

Insiders sold stock recently, but they haven't been buying. And even if we look at the last year, we didn't see any purchases. But since Ralph Lauren is profitable and growing, we're not too worried by this. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. To assist with this, we've discovered 1 warning sign that you should run your eye over to get a better picture of Ralph Lauren.

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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.