Even though nVent Electric plc (NYSE:NVT) stock gained 3.0% last week, insiders who sold US$5.0m worth of stock over the past year are probably better off. Holding on to stock would have meant their investment would be worth less now than it was at the time of sale. Thus selling at an average price of US$37.76, which is higher than the current price, may have been the best decision.

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.

See our latest analysis for nVent Electric

Over the last year, we can see that the biggest insider sale was by the Independent Chairman, Randall Hogan, for US$5.0m worth of shares, at about US$37.76 per share. That means that an insider was selling shares at around the current price of US$35.69. We generally don't like to see insider selling, but the lower the sale price, the more it concerns us. In this case, the big sale took place at around the current price, so it's not too bad (but it's still not a positive). Randall Hogan was the only individual insider to sell over the last year.

Over the last year, we can see that insiders have bought 4.36k shares worth US$150k. But they sold 132.42k shares for US$5.0m. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

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).

Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. Insiders own 0.7% of nVent Electric shares, worth about US$42m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

There haven't been any insider transactions in the last three months -- that doesn't mean much. We don't take much encouragement from the transactions by nVent Electric insiders. The modest level of insider ownership is, at least, some comfort. While we like knowing 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. For example - nVent Electric has 1 warning sign we think you should be aware of.

Of course nVent Electric may not be the best stock to buy. So you may wish to see this free collection of high quality companies.

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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nVent Electric plc designs, manufactures, markets, installs, and services electrical connection and protection products worldwide.

Proven track record with adequate balance sheet.

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