Heavy Insider Selling That Can Raise Red Flags Detected At These 3 Companies

CBRE Group Inc. (NYSE:CBG) is another company that recorded a high volume of insider selling this month. In fact, investors should be particularly cautious about the insider selling activity at CBRE, as five different insiders have sold shares so far this month. Director Richard C. Blum discarded 36,888 shares on Tuesday at a price of $35.56 per share, cutting his overall holding to 26,189 shares. The company’s CEO and CFO were also selling shares in the past several days, but their sales were conducted under trading plans. The world’s largest commercial real estate services and investment firm has seen its shares gain 3% in 2015, and they are currently trading at a trailing P/E ratio of 20.81. The company’s operations and financial performance in particular are highly dependent on economic trends and government policies that impact both global and regional commercial real estate markets. The availability of low-cost credit has injected dynamism into commercial real estate markets in recent years, but the rising interest rate environment might have an adverse effect on these markets’ growth over the medium- and long-term horizon. A number of 32 hedge funds tracked by Insider Monkey were invested in the company at the end of the third quarter, accumulating 15.60% of its outstanding shares. Jeffrey Ubben’s ValueAct Capital held its position in CBRE Group Inc. (NYSE:CBG) unchanged during the September quarter at 31.33 million shares.

DCT Industrial Trust Inc. (NYSE:DCT) had an influential insider discard shares this week. President Jeffrey F. Phelan sold 28,470 shares on Tuesday at exactly $37 apiece, trimming his overall stake to 28,470 shares. It should be mentioned that the President was piling up shares in mid-2011 at prices that did not exceed $4.50 a share (before the company completed a one-for-four reverse stock split). This industrial real estate company that focuses on acquiring and leasing bulk distribution and light industrial properties has seen its shares advance 5% this year, thanks to the 20% rally since the beginning of September. The industrial real estate market has been strengthening in recent years, mainly due to a general improvement in the U.S. economy, along with the growth of e-commerce and U.S.-based manufacturing. The REIT acquired 14 buildings during the first nine months of 2015 for roughly $124.9 million. The company’s total rental revenues for the nine-month period that ended September 30 totaled $264.27 million, as compared with $250.21 million reported a year ago. It is also worth pointing out that the company’s ten largest customers occupy only 9.6% of its properties, so DCT Industrial Trust is highly diversified when it comes to customers and does not have high risks associated with the potential loss of a major customer. Nonetheless, Credit Suisse recently has downgraded the stock to ‘Underperform’ from ‘Neutral’ and cut its price target to $39 from $40. Israel Englander’s Millennium Management is the largest shareholder of DCT Industrial Trust Inc. (NYSE:DCT) within our database, holding 3.11 million shares as of September 30.

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