Over the past year, many Selective Insurance Group, Inc. (NASDAQ:SIGI) insiders sold a significant stake in the company which may have piqued investors' interest. When evaluating insider transactions, knowing whether insiders are buying versus if they selling is usually more beneficial, as the latter can be open to many interpretations. However, shareholders should take a deeper look if several insiders are selling stock over a specific time period.

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.

Selective Insurance Group Insider Transactions Over The Last Year

The CEO, President & Chairman, John Marchioni, made the biggest insider sale in the last 12 months. That single transaction was for US$2.1m worth of shares at a price of US$102 each. That means that an insider was selling shares at below the current price (US$103). 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. It is worth noting that this sale was only 13% of John Marchioni's holding.

In the last twelve months insiders purchased 1.35k shares for US$134k. But they sold 34.60k shares for US$3.5m. Over the last year we saw more insider selling of Selective Insurance Group shares, than buying. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: insiders have been buying them).

Selective Insurance Group Insiders Are Selling The Stock

There was substantially more insider selling, than buying, of Selective Insurance Group shares over the last three months. We note insiders cashed in US$582k worth of shares. Meanwhile Independent Director Terrence Cavanaugh bought US$98k worth. Because the selling vastly outweighs the buying, we'd say this is a somewhat bearish sign.

Insider Ownership

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 1.5% of Selective Insurance Group shares, worth about US$93m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Does This Data Suggest About Selective Insurance Group Insiders?

The insider sales have outweighed the insider buying, at Selective Insurance Group, in the last three months. Despite some insider buying, the longer term picture doesn't make us feel much more positive. But it is good to see that Selective Insurance Group is growing earnings. 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 Selective Insurance Group. You'd be interested to know, that we found 1 warning sign for Selective Insurance Group and we suggest you have a look.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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.