In the last year, many First Watch Restaurant Group, Inc. (NASDAQ:FWRG) insiders sold a substantial stake in the company which may have sparked shareholders' attention. When evaluating insider transactions, knowing whether insiders are buying is usually more beneficial than knowing whether they are selling, as the latter can be open to many interpretations. However, when multiple insiders sell stock over a specific duration, shareholders should take notice as that could possibly be a red flag.

Although we don't think shareholders should simply follow insider transactions, we do think it is perfectly logical to keep tabs on what insiders are doing.

First Watch Restaurant Group Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the Independent Director, Tricia Glynn, sold US$7.4m worth of shares at a price of US$16.42 per share. That means that an insider was selling shares at slightly below the current price (US$16.95). 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. However, while insider selling is sometimes discouraging, it's only a weak signal. This single sale was 100% of Tricia Glynn's stake.

First Watch Restaurant Group 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!

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Insiders At First Watch Restaurant Group Have Sold Stock Recently

The last three months saw significant insider selling at First Watch Restaurant Group. Specifically, insider William Kussell ditched US$185k 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

Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. Insiders own 1.3% of First Watch Restaurant Group shares, worth about US$14m. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Do The First Watch Restaurant Group Insider Transactions Indicate?

An insider hasn't bought First Watch Restaurant Group stock in the last three months, but there was some selling. And even if we look at the last year, we didn't see any purchases. On the plus side, First Watch Restaurant Group makes money, and is growing profits. Insiders own shares, but we're still pretty cautious, given the history of sales. We're in no rush to buy! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing First Watch Restaurant Group. At Simply Wall St, we found 1 warning sign for First Watch Restaurant Group that deserve your attention before buying any shares.

Of course First Watch Restaurant Group 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.

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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.

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