Recent insider trends for Starbucks Corporation (NASDAQ:SBUX) have caught the attention of investors. Analysts monitor insider data to understand the sentiment of a company’s largest and most important shareholders. SBUX’s insider trading patterns have some implications for where the stock might be headed.
Institutions own 73.10% of Starbucks Corporation (SBUX)’s shares. The total value of these holdings, in millions, is $61,720. Among active positions in the latest quarter, 667 holders increased their positions by a total of 92.04 million shares, 691 holders decreased the positions by a total of 106.31 million shares, and 162 holders held their positions. This works out to a net decrease in ownership of 14.27 million shares, and suggests that institutions are feeling bearish about the stock.
Among new and sold out positions, 89 holders initiated new positions by a total of 24.59 million shares and 125 holders exited their positions by a total of 10.22 million shares. This nets out to an increase of 14.37 million shares and is a bullish sign for SBUX.
In the last three months, insiders executed a total of 32 trades. 12 of these were buys and 20 were sells. Insider ownership decreased by a total of 1.22 million shares, which suggests that SBUX’s key executives are feeling less optimistic about the outlook for the stock. The data from the past twelve months tells a similar story: insiders executed 16 buys and 37 sells, and ownership decreased by a net of 2.05 million shares.
The analysis of insider buying and selling trends can be extended to the aggregate level. Short interest, which represents the number of a stock’s shares currently being shorted, captures what the market as a whole feels about a stock. Starbucks Corporation (NASDAQ:SBUX)’s short interest is 24.18 million shares, or 1.70% of the float. This represents an increase of 7% in the number of shares being shorted compared to the previous reading, and implies that investors felt more pessimistic about the stock during the past two weeks.
In light of the insider ownership and trading data it makes sense to consider technicals to see if they come to a similar conclusion about the outlook for SBUX. A composite of 13 technical indicators that includes measures such as moving averages and momentum oscillators suggests that SBUX is a Strong buy, which implies that SBUX is expected to outperform the market based on prior trading patterns.
Institutional ownership trends suggest that the stock is cheap and the insider trading data indicates that insiders are bearish. Technical indicators (also) suggest that Starbucks Corporation (NASDAQ:SBUX) is undervalued.