We wouldn't blame Stagwell Inc. (NASDAQ:STGW) shareholders if they were a little worried about the fact that Bradley Gross, the Independent Director recently netted about US$13m selling shares at an average price of US$6.04. Probably the most concerning element of the whole transaction is that the disposal amounted to 100% of their entire holding.

Stagwell Insider Transactions Over The Last Year

In fact, the recent sale by Bradley Gross was the biggest sale of Stagwell 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$6.46, 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. However, while insider selling is sometimes discouraging, it's only a weak signal. This single sale was 100% of Bradley Gross's stake.

In the last twelve months insiders purchased 48.94k shares for US$221k. But insiders sold 2.16m shares worth US$13m. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

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Does Stagwell Boast High Insider Ownership?

For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Stagwell insiders own 11% of the company, currently worth about US$178m based on the recent share price. 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 Does This Data Suggest About Stagwell Insiders?

An insider sold Stagwell shares recently, but they didn't buy any. Zooming out, the longer term picture doesn't give us much comfort. On the plus side, Stagwell makes money, and is growing profits. 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. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. At Simply Wall St, we've found that Stagwell has 3 warning signs (1 doesn't sit too well with us!) that deserve your attention before going any further with your analysis.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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.