Don’t Ignore The Insider Selling In GE HealthCare Technologies

Some GE HealthCare Technologies Inc. (NASDAQ:GEHC) shareholders may be a little concerned to see that insider Kenneth Stacherski recently sold a substantial US$1.6m worth of stock at a price of US$83.22 per share. That diminished their holding by a very significant 100%, which arguably implies a strong desire to reallocate capital.

Check out our latest analysis for GE HealthCare Technologies

The Last 12 Months Of Insider Transactions At GE HealthCare Technologies

In fact, the recent sale by Kenneth Stacherski was the biggest sale of GE HealthCare Technologies shares made by an insider individual in the last twelve months, according to our records. That means that an insider was selling shares at below the current price (US$84.80). 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. However, while insider selling is sometimes discouraging, it’s only a weak signal. It is worth noting that this sale was 100% of Kenneth Stacherski’s holding.

All up, insiders sold more shares in GE HealthCare Technologies than they bought, 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 want to know exactly who sold, for how much, and when, simply click on the graph below!

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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. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Insiders own 0.08% of GE HealthCare Technologies shares, worth about US$30m. 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 GE HealthCare Technologies Insiders?

Insiders sold GE HealthCare Technologies shares recently, but they didn’t buy any. Zooming out, the longer term picture doesn’t give us much comfort. Insider ownership isn’t particularly high, so this analysis makes us cautious about the company. So we’d only buy after careful consideration. 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. In terms of investment risks, we’ve identified 2 warning signs with GE HealthCare Technologies and understanding them should be part of your investment process.

But note: GE HealthCare Technologies 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.