Bullish SmartRent, Inc. (NYSE:SMRT) insiders filled their treasuries with US$1.9m worth of stock over last year
Over the last year, a good number of insiders have significantly increased their holdings in SmartRent, Inc. (NYSE:SMRT). This is encouraging because it indicates that insiders are more optimistic about the company's prospects.
While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.
See our latest analysis for SmartRent
SmartRent Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when Independent Director Robert Best bought US$1.0m worth of shares at a price of US$4.64 per share. That implies that an insider found the current price of US$5.06 per share to be enticing. That means they have been optimistic about the company in the past, though they may have changed their mind. We do always like to see insider buying, but it is worth noting if those purchases were made at well below today's share price, as the discount to value may have narrowed with the rising price. The good news for SmartRent share holders is that insiders were buying at near the current price.
Happily, we note that in the last year insiders paid US$1.9m for 325.66k shares. But insiders sold 165.00k shares worth US$825k. In the last twelve months there was more buying than selling by SmartRent insiders. They paid about US$5.77 on average. These transactions suggest that insiders have considered the current price attractive. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).
Insiders at SmartRent Have Bought Stock Recently
There has been significantly more insider buying, than selling, at SmartRent, over the last three months. In total, two insiders bought US$1.2m worth of shares in that time. On the other hand, insiders netted US$825k by selling. We think insiders may be optimistic about the future, since insiders have been net buyers of shares.
Insider Ownership of SmartRent
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. A high insider ownership often makes company leadership more mindful of shareholder interests. It appears that SmartRent insiders own 8.7% of the company, worth about US$86m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
So What Do The SmartRent Insider Transactions Indicate?
It is good to see recent purchasing. We also take confidence from the longer term picture of insider transactions. However, we note that the company didn't make a profit over the last twelve months, which makes us cautious. Insiders likely see value in SmartRent shares, given these transactions (along with notable insider ownership of the company). So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. In terms of investment risks, we've identified 2 warning signs with SmartRent and understanding these should be part of your investment process.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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.
