We'd be surprised if Power Integrations, Inc. (NASDAQ:POWI) shareholders haven't noticed that the Executive Chairman, Balu Balakrishnan, recently sold US$260k worth of stock at US$46.59 per share. However, the silver lining is that the sale only reduced their total holding by 1.2%, so we're hesitant to read anything much into it, on its own.

Power Integrations Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the insider, Douglas Bailey, sold US$796k worth of shares at a price of US$46.86 per share. That means that an insider was selling shares at around the current price of US$45.24. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. Given that the sale took place at around current prices, it makes us a little cautious but is hardly a major concern.

Power Integrations insiders didn't buy any shares over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

I will like Power Integrations better if I see some big insider buys.

Insider Ownership Of Power Integrations

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. A high insider ownership often makes company leadership more mindful of shareholder interests. It appears that Power Integrations insiders own 2.1% of the company, worth about US$54m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Do The Power Integrations Insider Transactions Indicate?

Insiders sold Power Integrations shares recently, but they didn't buy any. Looking to the last twelve months, our data doesn't show any insider buying. While insiders do own shares, they don't own a heap, and they have been selling. We'd practice some caution before buying! 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 Power Integrations has 3 warning signs and it would be unwise to ignore them.

Of course Power Integrations 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.