We wouldn't blame MSC Industrial Direct Co., Inc. (NYSE:MSM) shareholders if they were a little worried about the fact that Erik Gershwind, the CEO & Director recently netted about US$4.5m selling shares at an average price of US$90.36. However, that sale only accounted for 2.4% of their holding, so arguably it doesn't say much about their conviction.

MSC Industrial Direct Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the Non-Executive Chairman, Mitchell Jacobson, sold US$15m worth of shares at a price of US$97.66 per share. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. The good news is that this large sale was at well above current price of US$85.45. So it is hard to draw any strong conclusion from it.

MSC Industrial Direct insiders didn't buy any shares over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. 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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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. MSC Industrial Direct insiders own about US$1.1b worth of shares (which is 22% 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 Do The MSC Industrial Direct Insider Transactions Indicate?

Insiders sold stock recently, but they haven't been buying. And even if we look at the last year, we didn't see any purchases. It is good to see high insider ownership, but the insider selling leaves us cautious. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Case in point: We've spotted 1 warning sign for MSC Industrial Direct 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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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.