There is much investors can learn by following the behavior of company insiders when it comes to how they handle positions in their own companies. While these insiders may sell shares for many reasons (buying a house, paying for college, or getting ready for retirement), they generally buy for only one reason: they think they will make more money.
The chief executive officer often is one of the largest and best-informed shareholders in any corporation. Let’s see whether CrowdStrike Holdings Inc. (NASDAQ: CRWD) CEO George Kurtz has been increasing or decreasing his shares over the past year and whether he knows something we don’t.
What You Need to Know About CrowdStrike
CrowdStrike provides cloud-delivered protection across endpoints and cloud workloads, identity, and data. It offers corporate workload security, security and vulnerability management, managed security services, IT operations management, threat intelligence services, identity protection, and log management. The company primarily sells subscriptions to its Falcon platform and cloud modules through its direct sales team that leverages its network of channel partners. It serves customers worldwide.
The company was incorporated in 2011 and is headquartered in Austin, Texas. That is also the home of Oracle Corp. (NASDAQ: ORCL), Tesla Inc. (NASDAQ: TSLA) and Whole Foods Markets. CrowdStrike’s competitors include Fortinet Inc. (NASDAQ: FTNT), Palo Alto Networks Inc. (NASDAQ: PANW), and SentinelOne Inc. (NYSE: S). Kurtz, one of CrowdStrike’s co-founders, has been chief executive since the company was founded.
The company reported annual revenue of more than $2.8 billion, and its market capitalization is over $75.5 billion. The share price is more than 200% higher than it was a year ago, far outpacing the broader markets. The stock is trading near its all-time high.
How CrowdStrike’s CEO Is Trading
One year ago, Kurtz owned around 11.1 million shares, worth over $1.8 billion. Today, he owns about 7.8 million shares, which is a stake of about 3.2%. Despite reducing the stake by almost a third, the value of the stake has risen by over 24.6% to nearly $2.3 billion as the share price skyrocketed.
|Shares a Year Ago
With shares soaring, who wouldn’t be tempted to take advantage and cash in at least somewhat? However, CEO George Kurtz could have sold for a variety of reasons, and we may never know the truth. But note that he has plenty of company, in that many insiders have been selling shares. So then, is it a case of what goes up must come down? Some analysts consider the stock to be overbought, and the consensus price target is well below the current share price. So, maybe.
Another shareholder to watch is Sameer Gandhi. His stake of almost 0.4% is worth over $272.9 million. CrowdStrike Chief Financial Officer Burt Podbere’s 0.1% stake is worth $98.8 million, while President Michael Sentonas has a 01.% stake worth $92.7 million. Note that Kurtz, Gandhi, and Sentonas sold shares last month, and many insiders were selling in December. (These 19 executives pay themselves over $150 million a year.)
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Author: Trey Thoelcke
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