Anyone interested in The Cheesecake Factory Incorporated (NASDAQ:CAKE) should probably be aware that the VP, Principal Accounting Officer & Controller, Ashley Hanscom, recently divested US$350k worth of shares in the company, at an average price of US$100.00 each. The eyebrow raising move amounted to a reduction of 16% in their holding.

The Last 12 Months Of Insider Transactions At Cheesecake Factory

The President, David Gordon, made the biggest insider sale in the last 12 months. That single transaction was for US$630k worth of shares at a price of US$63.37 each. That means that even when the share price was below the current price of US$105, 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. It is worth noting that this sale was only 11% of David Gordon's holding.

Cheesecake Factory insiders didn't buy any shares over the last year. 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!

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: Most of them are flying under the radar).

Insider Ownership Of Cheesecake Factory

Many investors like to check how much of a company is owned by 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. Cheesecake Factory insiders own 8.1% of the company, currently worth about US$420m based on the recent share price. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Does This Data Suggest About Cheesecake Factory Insiders?

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 Cheesecake Factory is profitable and growing, we're not too worried by this. It is good to see high insider ownership, but the insider selling leaves us cautious. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Cheesecake Factory.

Of course Cheesecake Factory 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.