Those following along with Netflix, Inc. (NASDAQ:NFLX) will no doubt be intrigued by the recent purchase of shares by Wilmot Hastings, Co-Founder of the company, who spent a stonking US$20m on stock at an average price of US$389. There's no denying a buy of that magnitude suggests conviction in a brighter future, although we do note that proportionally it only increased their holding by 1.0%.
The Last 12 Months Of Insider Transactions At Netflix
In fact, the recent purchase by Wilmot Hastings was the biggest purchase of Netflix shares made by an insider individual in the last twelve months, according to our records. We do like to see buying, but this purchase was made at well below the current price of US$457. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.
The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!
Netflix is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
Insider Ownership of Netflix
Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. Netflix insiders own about US$2.7b worth of shares (which is 1.3% of the company). I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
What Might The Insider Transactions At Netflix Tell Us?
The recent insider purchase is heartening. And the longer term insider transactions also give us confidence. Once you factor in the high insider ownership, it certainly seems like insiders are positive about Netflix. Looks promising! In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Netflix. To that end, you should learn about the 3 warning signs we've spotted with Netflix (including 2 which are potentially serious).
But note: Netflix may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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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