A lot in the past year Take-Two Interactive Software, Inc. (NASDAQ:TTWO) insiders sold a substantial stake in the company, which may have caught the attention of shareholders. Knowing whether insiders are buying is usually more useful when evaluating insider transactions because insider sales can have several explanations. However, shareholders should look deeper if multiple insiders are selling shares over a period of time.
While insider transactions aren’t the be-all and end-all when it comes to long-term investing, logic dictates that you should pay some attention to whether insiders are buying or selling shares.
Check out our latest analysis for Take-Two Interactive Software
Over the past twelve months, the largest sale by an insider occurred when Chief Financial Officer Lainie Goldstein sold $8.8 million worth of stock at a price of $179 per share. That means that even when the stock price was below the current price of $185, an insider wanted to cash in on some shares. When an insider sells below the current price, it suggests that he/she considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. While insider selling isn’t a positive sign, we’re not sure it means insiders think the stock is fully valued. So it’s just a weak sign. This single sale amounted to only 35% of Lainie Goldstein’s stake.
Take-Two Interactive Software insiders haven’t bought any shares in the last year. Below you will see a visual representation of insider transactions (by companies and individuals) over the last twelve months. If you click on the chart you can see all the individual transactions, including the stock price, the individual and the date!
I’ll like Take-Two Interactive Software more if I see some big insider buying. While we wait, take a look at this free list of undervalued and small-cap stocks with significant, recent insider purchasing.
Over the past three months, we’ve seen significant insider selling at Take-Two Interactive Software. In total, insiders dumped $18 million worth of shares in that time, and we didn’t record a single purchase. Overall, this makes us a little cautious, but it’s not all.
Many investors like to check how much of a company is owned by insiders. Typically, the higher the insider ownership, the more likely it is that insiders will be incentivized to build the company for the long term. Take-Two Interactive Software insiders own about $127 million worth of stock (which is 0.4% of the company). This type of significant insider ownership usually increases the likelihood that the company is run in the interests of all shareholders.
Insiders have been selling shares recently, but they haven’t been buying. And no purchases were made in the past year that could bring us comfort. The company has high insider ownership, but we’re a bit cautious given its history of share sales. So while it’s useful to know what insiders are doing in terms of buying or selling, it’s also useful to know what risks a particular company is facing. Every company has risks, and we have noticed that 2 warning signs for Take-Two Interactive Software you should know.
Naturally Take-Two Interactive Software might not be the best stock to buy. So you might want 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. Currently, we only consider open market transactions and private dispositions involving direct interests, but not derivative transactions or indirect interests.
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This article from Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts using only an unbiased methodology and our articles are not intended as financial advice. It is not a recommendation to buy or sell any stock and does not take into account your objectives or financial situation. We aim to provide you with targeted, long-term analysis based on fundamental data. Please note that our analysis may not take into account the latest price-sensitive company announcements or quality material. Simply Wall St has no positions in the stocks mentioned.
