Flex Chief Financial Officer Kevin Krumm Sells 45% Of Holding

We wouldn't blame Flex Ltd. (NASDAQ:FLEX) shareholders if they were a little worried about the fact that Kevin Krumm, the Chief Financial Officer recently netted about US$1.3m selling shares at an average price of US$61.23. That sale reduced their total holding by 45% which is hardly insignificant, but far from the worst we've seen.

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The Last 12 Months Of Insider Transactions At Flex

Over the last year, we can see that the biggest insider sale was by the CEO & Director, Revathi Advaithi, for US$7.8m worth of shares, at about US$42.91 per share. That means that even when the share price was below the current price of US$63.83, an insider wanted to cash in some shares. 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. It is worth noting that this sale was only 14% of Revathi Advaithi's holding.

In the last year Flex insiders didn't buy any company stock. 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!

See our latest analysis for Flex

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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. Flex insiders own 0.7% of the company, currently worth about US$164m based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Do The Flex Insider Transactions Indicate?

Insiders haven't bought Flex stock in the last three months, but there was some selling. And there weren't any purchases to give us comfort, over the last year. But it is good to see that Flex is growing earnings. It is good to see high insider ownership, but the insider selling leaves us cautious. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Flex. At Simply Wall St, we found 1 warning sign for Flex that deserve your attention before buying any shares.

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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.