Insiders at T-Mobile US, Inc. (NASDAQ:TMUS) sold US$5.0m worth of stock, possibly indicating weakness in the future

The fact that multiple T-Mobile US, Inc. (NASDAQ:TMUS) insiders offloaded a considerable amount of shares over the past year could have raised some eyebrows amongst investors. When analyzing insider transactions, it is usually more valuable to know whether insiders are buying versus knowing if they are selling, as the latter sends an ambiguous message. However, shareholders should take a deeper look if several insiders are selling stock over a specific time period.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

See our latest analysis for T-Mobile US

T-Mobile US Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by the Chief Marketing Officer, Michael Katz, for US$3.2m worth of shares, at about US$145 per share. So it’s clear an insider wanted to take some cash off the table, even below the current price of US$149. 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. 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. We note that the biggest single sale was only 17% of Michael Katz’s holding.

T-Mobile US 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!

insider-trading-volume

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

Insiders At T-Mobile US Have Sold Stock Recently

The last quarter saw substantial insider selling of T-Mobile US shares. In total, insiders sold US$5.0m worth of shares in that time, and we didn’t record any purchases whatsoever. Overall this makes us a bit cautious, but it’s not the be all and end all.

Insider Ownership Of T-Mobile US

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 encouraged to build the company for the long term. T-Mobile US insiders own about US$1.2b worth of shares (which is 0.7% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Does This Data Suggest About T-Mobile US Insiders?

Insiders haven’t bought T-Mobile US stock in the last three months, but there was some selling. And there weren’t any purchases to give us comfort, over the last year. The company boasts high insider ownership, but we’re a little hesitant, given the history of share sales. So while it’s helpful to know what insiders are doing in terms of buying or selling, it’s also helpful to know the risks that a particular company is facing. Case in point: We’ve spotted 4 warning signs for T-Mobile US you should be aware of.

But note: T-Mobile US may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.

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, but not derivative transactions.

Have feedback on this article? Concerned about the content? get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.

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