The fact that multiple Colgate-Palmolive Company (NYSE:CL) insiders offloaded a considerable amount of shares over the past year could have raised some eyebrows amongst investors. When analyzing insider transactions, it is usually more valuable to know whether insiders are buying versus knowing if they are selling, as the latter sends an ambiguous message. However, when multiple insiders sell stock over a specific duration, shareholders should take notice as that could possibly be a red flag.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we would consider it foolish to ignore insider transactions altogether.

Check out our latest analysis for Colgate-Palmolive

The Last 12 Months Of Insider Transactions At Colgate-Palmolive

The Chairman, Noel Wallace, made the biggest insider sale in the last 12 months. That single transaction was for US$1.2m worth of shares at a price of US$84.17 each. That means that even when the share price was below the current price of US$94.72, an insider wanted to cash in some shares. 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. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. It is worth noting that this sale was only 3.6% of Noel Wallace's holding.

In the last year Colgate-Palmolive insiders didn't buy any company stock. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

For those who like to find hidden gems this free list of small cap companies with recent insider purchasing, could be just the ticket.

Insider Ownership Of Colgate-Palmolive

For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 0.1% of Colgate-Palmolive shares, worth about US$80m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Does This Data Suggest About Colgate-Palmolive Insiders?

It doesn't really mean much that no insider has traded Colgate-Palmolive shares in the last quarter. We don't take much encouragement from the transactions by Colgate-Palmolive insiders. The modest level of insider ownership is, at least, some comfort. While it's good to be aware of what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. Case in point: We've spotted 1 warning sign for Colgate-Palmolive you should be aware of.