The fact that multiple Selective Insurance Group, Inc. (NASDAQ:SIGI) insiders offloaded a considerable amount of shares over the past year could have raised some eyebrows amongst investors. Knowing whether insiders are buying is usually more helpful when evaluating insider transactions, as insider selling can have various explanations. However, shareholders should take a deeper look if several insiders are selling stock over a specific time period.

While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

See our latest analysis for Selective Insurance Group

Selective Insurance Group Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the CEO, President & Chairman, John Marchioni, sold US$2.1m worth of shares at a price of US$102 per share. So it's clear an insider wanted to take some cash off the table, even slightly below the current price of US$103. 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. However, while insider selling is sometimes discouraging, it's only a weak signal. We note that the biggest single sale was only 13% of John Marchioni's holding.

Happily, we note that in the last year insiders paid US$234k for 2.35k shares. On the other hand they divested 35.16k shares, for US$3.6m. All up, insiders sold more shares in Selective Insurance Group 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. By clicking on the graph below, you can see the precise details of each insider transaction!

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

Selective Insurance Group Insiders Are Selling The Stock

We've seen more insider selling than insider buying at Selective Insurance Group recently. We note Lead Independent Director Robert Doherty cashed in US$304k worth of shares. Meanwhile Independent Director Terrence Cavanaugh bought US$98k worth. Because the selling vastly outweighs the buying, we'd say this is a somewhat bearish sign.

Does Selective Insurance Group Boast High Insider Ownership?

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. Selective Insurance Group insiders own about US$93m worth of shares. That equates to 1.5% of the company. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

What Might The Insider Transactions At Selective Insurance Group Tell Us?

Unfortunately, there has been more insider selling of Selective Insurance Group stock, than buying, in the last three months. Despite some insider buying, the longer term picture doesn't make us feel much more positive. But it is good to see that Selective Insurance Group is growing earnings. Insider ownership isn't particularly high, so this analysis makes us cautious about the company. We'd practice some caution before buying! Therefore, you should definitely take a look at this FREE report showing analyst forecasts for Selective Insurance Group.

Of course Selective Insurance Group may not be the best stock to buy. So you may wish to see this free collection of high quality 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.