Recent insider trends for PayPal Holdings, Inc. (NASDAQ:PYPL) have caught the attention of investors. Analysts monitor insider data to understand the sentiment of a company’s largest and most important shareholders. PYPL’s insider trading patterns have some implications for where the stock might be headed.
Institutions own 83.87% of PayPal Holdings, Inc. (PYPL)’s shares. The total value of these holdings, in millions, is $74,588. Among active positions in the latest quarter, 482 holders increased their positions by a total of 112.53 million shares, 550 holders decreased the positions by a total of 90.58 million shares, and 150 holders held their positions. This works out to a net increase in ownership of 21.95 million shares, and suggests that institutions are feeling bullish about the stock.
Among new and sold out positions, 108 holders initiated new positions by a total of 32.4 million shares and 68 holders exited their positions by a total of 14.04 million shares. This nets out to an increase of 18.37 million shares and is a bullish sign for PYPL.
In the last three months, insiders executed a total of 5 trades. 1 of these were buys and 4 were sells. Insider ownership decreased by a total of 74793 shares, which suggests that PYPL’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 18 buys and 51 sells, and ownership decreased by a net of 2.85 million shares.
Short interest, or the number of a stock’s tradable shares currently being shorted, is another metric investors use to get a pulse on sentiment. PayPal Holdings, Inc. (NASDAQ:PYPL)’s short interest is 19.37 million shares, or 1.70% of the float. This represents a decrease of -26% in the number of shares being shorted compared to the previous reading, and implies that investors felt less pessimistic about the stock during the past two weeks.
Given what the insider ownership patterns are saying, it makes sense to consider the technicals to see if these pieces of information reach the same conclusion about the outlook for PYPL. A composite of 13 technical indicators that includes measures such as moving averages and momentum oscillators suggests that PYPL is a Strong buy, which implies that PYPL 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 PayPal Holdings, Inc. (NASDAQ:PYPL) is undervalued.