Intercontinental Exchange insiders sell $1.8 million worth of stock, possibly signaling warning

Over the past year, many Intercontinental Exchange, Inc. (NYSE:ICE) insiders sold a substantial stake in the company, which may have caught the attention of shareholders. When analyzing insider trades, it is usually more useful to know whether insiders are buying rather than whether they are selling, because the latter sends an ambiguous message. However, if many insiders are selling, shareholders should investigate further.

Although we would never suggest that investors base their decisions solely on what a company’s directors have done, logic dictates that you pay attention to whether insiders are buying or selling shares.

Check out our latest analysis for Intercontinental Exchange

Intercontinental Exchange insider trades over the past year

In fact, the recent sale by Jeffrey Sprecher was the largest sale of Intercontinental Exchange stock by an insider in the past twelve months, according to our records. So what is clear is that an insider saw fit to sell around the current price of US$105. While we generally don’t like to see insider selling, it’s more of a concern if the selling takes place at a lower price. We note that this sale took place around the current price, so it is not a major concern, although it is not a good sign.

Last year, Intercontinental Exchange insiders did not buy any shares of the company. The chart below shows insider trading (by companies and individuals) over the past year. If you want to know exactly who sold, how much and when, just click on the chart below!

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

Intercontinental Exchange insiders sell the shares

The past three months have seen significant insider selling at the Intercontinental Exchange. In total, insiders sold $1.8 million worth of shares during this period, and we did not record any purchases. This may suggest that some insiders think stocks aren’t cheap.

Does Intercontinental Exchange boast of high insider ownership?

Examining the total insider holdings in a company can help you know if they are well aligned with common shareholders. Usually, the higher the insider ownership, the more likely insiders will be incentivized to build the company for the long term. Intercontinental Exchange insiders own approximately $417 million in stock (or 0.7% of the company). Most shareholders would be happy to see this type of insider ownership, as it suggests that management’s incentives are well aligned with those of other shareholders.

So what do Intercontinental Exchange insider trading indicate?

Insiders have been selling stocks recently, but they haven’t been buying. And there have been no purchases to comfort us in the past year. The company enjoys strong insider ownership, but we are a bit hesitant given the history of stock sales. So these insider trades can help us build a thesis on the stock, but it’s also helpful to know the risks this company faces. At Simply Wall St, we have found that Intercontinental Exchange has 3 warning signs (1 does not really suit us!) which deserve your attention before going further in your analysis.

But note: Intercontinental Exchange may not be the best stock to buy. So take a look at this free list of interesting companies with high ROE and low debt.

For the purposes of this article, insiders are persons who report their transactions to the relevant regulatory body. We currently record open market transactions and private dispositions, but not derivative transactions.

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This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.