Some Fastly, Inc. (NYSE:FSLY) shareholders may be a little concerned to see that the Co-Founder, Artur Bergman, recently sold a substantial US$1.7m worth of stock at a price of US$16.87 per share. However, that sale only accounted for 1.2% of their holding, so arguably it doesn't say much about their conviction.
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The Last 12 Months Of Insider Transactions At Fastly
Notably, that recent sale by Co-Founder Artur Bergman was not the only time they sold Fastly shares this year. They previously made an even bigger sale of -US$3.5m worth of shares at a price of US$16.74 per share. That means that an insider was selling shares at slightly below the current price (US$17.94). As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. This single sale was just 2.4% of Artur Bergman's stake.
Insiders in Fastly didn't buy any shares in the last year. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
I will like Fastly better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.
Insider Ownership Of Fastly
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. A high insider ownership often makes company leadership more mindful of shareholder interests. Fastly insiders own 7.5% of the company, currently worth about US$167m based on the recent share price. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
So What Do The Fastly Insider Transactions Indicate?
Insiders haven't bought Fastly 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. It is good to see high insider ownership, but the insider selling leaves us cautious. 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 that a particular company is facing. While conducting our analysis, we found that Fastly has 4 warning signs and it would be unwise to ignore these.
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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.