We wouldn't blame Core Scientific, Inc. (NASDAQ:CORZ) shareholders if they were a little worried about the fact that Yadin Rozov, the Independent Director recently netted about US$1.9m selling shares at an average price of US$18.11. That sale reduced their total holding by 38% which is hardly insignificant, but far from the worst we've seen.

Core Scientific Insider Transactions Over The Last Year

In fact, the recent sale by Yadin Rozov was the biggest sale of Core Scientific shares made by an insider individual in the last twelve months, according to our records. That means that even when the share price was slightly below the current price of US$18.23, an insider wanted to cash in some shares. 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. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. This single sale was just 38% of Yadin Rozov's stake.

In the last twelve months insiders purchased 468.76k shares for US$2.0m. But insiders sold 191.92k shares worth US$2.9m. All up, insiders sold more shares in Core Scientific than they bought, over the last year. The sellers received a price of around US$15.12, on average. It's not particularly great to see insiders were selling shares at below recent prices. Since insiders sell for many reasons, we wouldn't put too much weight on it. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

If you are like me, then you will not want to miss this free list of small cap stocks that are not only being bought by insiders but also have attractive valuations.

Insider Ownership Of Core Scientific

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. I reckon it's a good sign if insiders own a significant number of shares in the company. It's great to see that Core Scientific insiders own 6.0% of the company, worth about US$304m. 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 Core Scientific Insiders?

The insider sales have outweighed the insider buying, at Core Scientific, in the last three months. Zooming out, the longer term picture doesn't give us much comfort. While insiders do own a lot of shares in the company (which is good), our analysis of their transactions doesn't make us feel confident about the company. While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. To that end, you should learn about the 2 warning signs we've spotted with Core Scientific (including 1 which is a bit unpleasant).

But note: Core Scientific 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 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.