Insiders At Kratos Defense & Security Solutions Sold US$2.6m In Stock, Alluding To Potential Weakness

Kratos Defense & Security Solutions, Inc. +1.60%

Kratos Defense & Security Solutions, Inc.

KTOS

21.54

+1.60%

Many Kratos Defense & Security Solutions, Inc. (NASDAQ:KTOS) insiders ditched their stock over the past year, which may be of interest to the company's shareholders. When evaluating insider transactions, knowing whether insiders are buying versus if they selling is usually more beneficial, as the latter can be open to many interpretations. However, if numerous insiders are selling, shareholders should investigate more.

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 Kratos Defense & Security Solutions

Kratos Defense & Security Solutions Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by the President of Microwave Electronics Division, Yonah Adelman, for US$1.1m worth of shares, at about US$16.50 per share. That means that even when the share price was below the current price of US$17.63, an insider wanted to cash in some shares. When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. It is worth noting that this sale was only 50% of Yonah Adelman's holding.

In the last year Kratos Defense & Security Solutions insiders didn't buy any company stock. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

insider-trading-volume
NasdaqGS:KTOS Insider Trading Volume January 30th 2024

I will like Kratos Defense & Security Solutions better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

Kratos Defense & Security Solutions Insiders Are Selling The Stock

The last three months saw significant insider selling at Kratos Defense & Security Solutions. In total, insiders sold US$524k worth of shares in that time, and we didn't record any purchases whatsoever. In light of this it's hard to argue that all the insiders think that the shares are a bargain.

Insider Ownership Of Kratos Defense & Security Solutions

For a common shareholder, it is worth checking how many shares are held by company 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. Kratos Defense & Security Solutions insiders own about US$52m worth of shares. That equates to 2.3% of the company. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Do The Kratos Defense & Security Solutions Insider Transactions Indicate?

Insiders sold Kratos Defense & Security Solutions shares recently, but they didn't buy any. And even if we look at the last year, we didn't see any purchases. While insiders do own shares, they don't own a heap, and they have been selling. We'd practice some caution before buying! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Kratos Defense & Security Solutions. Case in point: We've spotted 2 warning signs for Kratos Defense & Security Solutions you should be aware of.

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.

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