Even though Jack in the Box Inc. (NASDAQ:JACK) stock gained 18% last week, insiders who sold US$1.4m worth of stock over the past year are probably better off. Selling at an average price of US$42.78, which is higher than the current price, may have been the wisest decision for these insiders as their investment would have been worth less now than when they sold.

Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.

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Jack in the Box Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the insider, Darin Harris, sold US$594k worth of shares at a price of US$40.52 per share. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. The silver lining is that this sell-down took place above the latest price (US$20.37). So it is hard to draw any strong conclusion from it.

Insiders in Jack in the Box didn't buy any shares in the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

View our latest analysis for Jack in the Box

I will like Jack in the Box better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.

Have Jack in the Box Insiders Traded Recently?

In the last three months, Senior VP & Chief People Officer Steven Piano sold US$4.4k worth of shares. That's not much at all. Looking at the net result, we don't think this recent trading sheds much light on how insiders, as a group, are feeling about the company's prospects.

Insider Ownership Of Jack in the Box

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Our data suggests Jack in the Box insiders own 0.7% of the company, worth about US$2.6m. We consider this fairly low insider ownership.

So What Do The Jack in the Box Insider Transactions Indicate?

While there has not been any insider buying in the last three months, there has been selling. However, the sales are not big enough to concern us at all. Recent insider selling makes us a little nervous, in light of the broader picture of Jack in the Box insider transactions. We also note that, as far as we can see, insider ownership is fairly low, compared to other companies. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Jack in the Box. Every company has risks, and we've spotted 2 warning signs for Jack in the Box you should know about.

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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.

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