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Anyone interested in Paycom Software, Inc. (NYSE:PAYC) should probably be aware that the Independent Director, J.C. Watts, recently divested US$110k worth of shares in the company, at an average price of US$328 each. On the bright side, that sale was only 6.3% of their holding, so we doubt it’s very meaningful, on its own.

Check out our latest analysis for Paycom Software

The Last 12 Months Of Insider Transactions At Paycom Software

In the last twelve months, the biggest single sale by an insider was when the Independent Director, Robert Levenson, sold US$21m worth of shares at a price of US$304 per share. That means that an insider was selling shares at slightly below the current price (US$330). As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. Please do note, however, that sellers may have a variety of reasons for selling, so we don’t know for sure what they think of the stock price. It is worth noting that this sale was 90% of Robert Levenson’s holding.

In the last year Paycom Software 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!

insider-trading-volume
NYSE:PAYC Insider Trading Volume May 22nd 2021

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

Insider Ownership

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. It’s great to see that Paycom Software insiders own 17% of the company, worth about US$3.2b. 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 Paycom Software Insider Transactions Indicate?

An insider hasn’t bought Paycom Software stock in the last three months, but there was some selling. And even if we look at the last year, we didn’t see any purchases. 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 while it’s helpful to know what insiders are doing in terms of buying or selling, it’s also helpful to know the risks that a particular company is facing. Every company has risks, and we’ve spotted 3 warning signs for Paycom Software you should know about.

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.

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This article by Simply Wall St is general in nature. 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.
*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020

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

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