It is not uncommon to see companies perform well in the years after insiders buy shares. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So before you buy or sell Dawson Geophysical Company (NASDAQ:DWSN), you may well want to know whether insiders have been buying or selling.
What Is Insider Selling?
It’s quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, such insiders must disclose their trading activities, and not trade on inside information.
Insider transactions are not the most important thing when it comes to long-term investing. But logic dictates you should pay some attention to whether insiders are buying or selling shares. For example, a Columbia University study found that ‘insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers’.
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Dawson Geophysical Insider Transactions Over The Last Year
Director William Barrett made the biggest insider purchase in the last 12 months. That single transaction was for US$105k worth of shares at a price of US$5.80 each. So it’s clear an insider wanted to buy, even at a higher price. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company’s future. That purchase may suggest an expectation of positive returns over the long term. The only individual insider to buy over the last year was William Barrett.
William Barrett bought a total of 47.10k shares over the year at an average price of US$5.26. You can see the insider transactions (by individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Dawson Geophysical is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Does Dawson Geophysical Boast High 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. We usually like to see fairly high levels of insider ownership. Insiders own 7.3% of Dawson Geophysical shares, worth about US$6.3m, according to our data. Overall, this level of ownership isn’t that impressive, but it’s certainly better than nothing!
So What Does This Data Suggest About Dawson Geophysical Insiders?
It’s certainly positive to see the recent insider purchase. And an analysis of the transactions over the last year also gives us confidence. However, we note that the company didn’t make a profit over the last twelve months, which makes us cautious. While the overall levels of insider ownership are below what we’d like to see, the history of transactions imply that Dawson Geophysical insiders are reasonably well aligned, and optimistic for the future. Therefore, you should should definitely take a look at this FREE report showing analyst forecasts for Dawson Geophysical.
But note: Dawson Geophysical 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.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at firstname.lastname@example.org.