Rio Tinto Group’s (LON: RIO) Iron Ore Chief Executive Simon Trott has just sold 96% of his stake
Some Rio Tinto Group (LON: RIO) Shareholders might be a little worried to see that Iron Ore chief executive Simon Trott recently sold shares worth a hefty £470,000 at £60.97 per share. This lowered their stake to 96%, presumably implying a strong desire to reallocate capital.
See our latest analysis for Rio Tinto Group
Rio Tinto Group insider trading over the past year
Chief Commercial Officer Alfredo Barrios made the biggest insider sale of the past 12 months. This single transaction involved £4.9 million worth of shares at a price of £59.71 each. So we know that an insider sold shares at around the current share price of UK£58.17. Although insider selling is negative, for us it is even more negative if the stock is sold at a lower price. Given that the sale took place roughly at current prices, this makes us a bit cautious but is hardly a major concern.
In total, insiders sold more Rio Tinto Group shares than they bought in the past year. You can see insider trading (by companies and individuals) over the past year illustrated in the table below. By clicking on the graph below, you will be able to see the precise detail of each insider trade!
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Owned by Rio Tinto Group Insiders
Another way to test alignment between a company’s executives and other shareholders is to look at how many shares they own. We generally like to see fairly high levels of insider ownership. Insiders hold 0.03% of Rio Tinto Group shares, worth around £34 million. This level of insider ownership is good, but just short of being particularly noteworthy. This certainly suggests a reasonable degree of alignment.
So what does this data suggest about Rio Tinto Group insiders?
Insider selling has exceeded insider buying at Rio Tinto Group over the past three months. And our longer-term analysis of insider trading didn’t provide confidence either. On the positive side, Rio Tinto Group is making money and increasing its profits. Insiders hold shares, but we remain quite cautious, given the history of sales. We would exercise caution before purchasing! In addition to knowing the insider trading taking place, it is beneficial to identify the risks that the Rio Tinto group faces. Every business has risks, and we’ve spotted 3 warning signs for Rio Tinto Group (of which 1 does not suit us too much!) that you should know.
But note: Rio Tinto Group 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.