We'd be surprised if Stem, Inc. (NYSE:STEM) shareholders haven't noticed that the CEO & Director, John Carrington, recently sold US$359k worth of stock at US$1.85 per share. That sale was 28% of their holding, so it does make us raise an eyebrow.

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The Last 12 Months Of Insider Transactions At Stem

Notably, that recent sale by John Carrington is the biggest insider sale of Stem shares that we've seen in the last year. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. The good news is that this large sale was at well above current price of US$1.36. So it may not shed much light on insider confidence at current levels.

Over the last year, we can see that insiders have bought 237.30k shares worth US$615k. On the other hand they divested 842.17k shares, for US$1.8m. All up, insiders sold more shares in Stem than they bought, over the last year. The sellers received a price of around US$2.14, on average. We are not joyful about insider selling. However, we do note that the average sale price was significantly higher than the current share price (which is US$1.36). 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!

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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. From our data, it seems that Stem insiders own 4.3% of the company, worth about US$8.9m. We do generally prefer see higher levels of insider ownership.

So What Does This Data Suggest About Stem Insiders?

The insider sales have outweighed the insider buying, at Stem, in the last three months. Despite some insider buying, the longer term picture doesn't make us feel much more positive. When you consider that most companies have higher levels of insider ownership, we're a little wary. So we'd only buy after very careful consideration. 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 5 warning signs that you should run your eye over to get a better picture of Stem.

Of course Stem 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.