Nasdaq-Listed Companies

Don't Ignore The Fact That This Insider Just Sold Some Shares In DocuSign, Inc. (NASDAQ:DOCU)

Some DocuSign, Inc. (NASDAQ:DOCU) shareholders may be a little concerned to see that the Lead Independent Director, Peter Solvik, recently sold a substantial US$2.3m worth of stock at a price of US$267 per share. However, that sale only accounted for 3.5% of their holding, so arguably it doesn't say much about their conviction.

The Last 12 Months Of Insider Transactions At DocuSign

In fact, the recent sale by Lead Independent Director Peter Solvik was not their only sale of DocuSign shares this year. They previously made an even bigger sale of -US$4.2m worth of shares at a price of US$242 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of US$262. 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. However, while insider selling is sometimes discouraging, it's only a weak signal. This single sale was just 6.5% of Peter Solvik's stake.

Insiders in DocuSign didn't buy any shares in the last year. 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!

insider-trading-volumeNasdaqGS:DOCU Insider Trading Volume October 12th 2021

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

Does DocuSign Boast High Insider Ownership?

For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. It's great to see that DocuSign insiders own 1.5% of the company, worth about US$788m. 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 DocuSign Insider Transactions Indicate?

An insider sold stock recently, but they haven't been buying. And there weren't any purchases to give us comfort, over the last year. 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. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Case in point: We've spotted 2 warning signs for DocuSign you should be aware of.

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, but not derivative transactions.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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