Extensive research has shown that corporate insiders tend to make more profit-generating trades than non-insiders, which serves as the primary reason Insider Monkey tracks and examines both insider buying and selling activity. At the same time, insider selling does not necessarily represent a bearish or negative signal, as insiders may cash out holdings for cash needs, tax payments, or other reasons unrelated to their companies’ performance and prospects. Nevertheless, investigating insider selling should still play a key role in one’s stock analysis process, as the timing of insiders’ sales may offer useful insights on how these well-informed individuals feel about their companies’ stock. Having that in mind, let’s proceed with the analysis of insider sales registered at three U.S.-listed companies and attempt to stipulate what might have caused insiders to sell shares.
Prior to discussing the insider trading activity, let’s make you familiar with what Insider Monkey does besides providing high-quality articles. At Insider Monkey, we track hedge funds’ moves in order to identify actionable patterns and profit from them. Our research has shown that hedge funds’ large-cap stock picks historically underperformed the S&P 500 Total Return Index by an average of seven basis points per month between 1999 and 2012. On the other hand, the 15 most popular small-cap stocks among hedge funds outperformed the S&P 500 Index by an average of 95 basis points per month (read more details here). Since the official launch of our small-cap strategy in August 2012, it has performed just as predicted, returning 102% and beating the market by more than 53 percentage points. We believe the data is clear: investors will be better off by focusing on small-cap stocks utilizing hedge fund expertise (while avoiding their high fees at the same time) rather than large-cap stocks.
Let’s begin this daily insider trading article by discussing the insider sales witnessed at Jones Lang LaSalle Inc. (NYSE:JLL). Alastair Hughes, Chief Executive Officer-Asia Pacific Operations, unloaded 8,000 shares on Thursday at a sale price of $164.51 per share, trimming his stake to 14,987 shares. The financial and professional services company, which specializes in commercial real estate and investment management, has seen its shares gain 8% in 2015 despite being significantly dragged down by the broader market sell-off in August. Real estate investment has been on an uptrend during the three quarters of 2015, as the company’s transaction volumes increased by 13% year-over-year. This trend is also reflected in Jones Lang LaSalle Inc. (NYSE:JLL)’s revenue growth; the company’s fee revenue totaled $1.3 billion for the third quarter of 2015, up 17% year-on-year in local currency. Earlier this month, Jones Lang LaSalle announced the acquisition of cloud-based facility management solutions provider Corrigo Incorporated, which will bolster its existing offerings. It is also worth pointing out that the stock is trading at a relatively cheap trailing price-to-earnings ratio of 17.26, which is noticeably lower than the mean of 22.71 for the S&P 500 Index. Ken Heebner’s Capital Growth Management reduced its position in Jones Lang LaSalle Inc. (NYSE:JLL) by 15% during the third quarter to 680,000 shares.