Whilst it may not be a huge deal, we thought it was good to see that Alan Smith, who is a company insider, recently bought US$73k worth of stock, for US$9.10 per share. While we're hesitant to get too excited about a purchase of that size, we do note it increased their holding by a solid 16%.
The Last 12 Months Of Insider Transactions At Graham
Over the last year, we can see that the biggest insider sale was by the VP of Finance & Administration, Jeffrey Glajch, for US$224k worth of shares, at about US$16.04 per share. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. It's of some comfort that this sale was conducted at a price well above the current share price, which is US$9.20. So it is hard to draw any strong conclusion from it. Jeffrey Glajch was the only individual insider to sell shares in the last twelve months.
Over the last year, we can see that insiders have bought 26.50k shares worth US$259k. But they sold 18.69k shares for US$291k. Jeffrey Glajch divested 18.69k shares over the last 12 months at an average price of US$15.54. The chart below shows insider transactions (by companies and individuals) over the last year. 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).
Insider Ownership
I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Our data indicates that Graham insiders own about US$7.5m worth of shares (which is 7.7% of the company). Overall, this level of ownership isn't that impressive, but it's certainly better than nothing!
So What Do The Graham Insider Transactions Indicate?
It's certainly positive to see the recent insider purchases. However, the longer term transactions are not so encouraging. The transactions over the last year don't give us confidence, and nor does the fairly low insider ownership, but at least the recent buying is a positive. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. Case in point: We've spotted 4 warning signs for Graham you should be aware of.
If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity and low debt.
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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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
