Chesapeake Utilities Insiders Sell $2.0M in Shares, Possibly Signaling Caution – Simply Wall St

a lot Chesapeake Utilities Corporation (NYSE: CPK ) insiders have divested their shares over the past year, which may be of interest to the company’s shareholders. Knowing whether insiders are buying is usually more useful in evaluating insider transactions because insider selling can have different explanations. However, shareholders should take a closer look if several insiders sell shares over a period of time.

Although insider trading is not the most important thing when it comes to long-term investing, we would be foolish to ignore insider trading entirely.

Check out our latest analysis on Chesapeake Utilities

The last 12 months of internal transactions at Chesapeake Utilities

Independent director Paul Maddock has made the biggest insider sale in the last 12 months. This single trade was for US$2.0 million worth of shares at US$114 each. This means that even when the stock price was below the current price of $118, the insider wanted to cash in some shares. When an insider sells below the current price, it suggests that he considered that lower price to be fair. It makes us wonder what they think of the (higher) recent valuation. Please note, however, that sellers may have different reasons for selling, so we don’t know for sure what they think of the stock price. That single sale was just 34% of Paul Maddock’s stake.

Chesapeake Utilities insiders have not bought shares in the past year. The chart below shows insider transactions (by companies and individuals) over the past year. By clicking on the graphic below, you can see the exact details of each internal transaction!

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Chesapeake Utilities insiders are selling the stock

The most recent quarter saw significant insider sales of Chesapeake Utilities stock. In total, independent director Paul Maddock sold $2.0 million worth of shares during this time and we did not record any purchases. Overall, this makes us a little cautious, but it’s not the be-all and end-all.

Does Chesapeake Utilities boast high insider ownership?

For the average shareholder, it’s worth checking how many shares are held by company insiders. Generally, the higher the insider ownership, the more likely the insiders will be incentivized to build the company over the long term. Chesapeake Utilities insiders own about $50 million worth of stock. This equates to 1.9% of the company. While this is a strong but not exceptional level of insider ownership, it is enough to show some alignment between management and smaller shareholders.

What can internal transactions at Chesapeake Utilities tell us?

An insider recently sold shares of Chesapeake Utilities, but they didn’t buy any. Looking at the last twelve months, our data shows no domestic purchases. Insiders own shares, but we are still quite cautious given the selling history. We are in no rush to buy! 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 a particular company is facing. Every company has risks and we have noticed them 4 Warning Signs for Chesapeake Utilities (of which 1 is important!) that you should know about.

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For the purposes of this article, insiders are those persons who report their transactions to the relevant regulatory authority. We currently report open market transactions and private dispositions only with direct interests, but not derivative transactions or indirect interests.

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This article from Simply Wall St is of a general nature. We provide commentary based on historical data and analyst forecasts, using only an unbiased methodology, and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell shares and does not take into account your goals or your financial situation. We aim to provide you with long-term focused analysis driven by fundamental data. Note that our analysis may not take into account the latest price-sensitive company announcements or quality materials. Simply Wall St has no position in the stocks mentioned.