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We’ve lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So before you buy or sell Veoneer, Inc. (NYSE:VNE), you may well want to know whether insiders have been buying or selling.
Do Insider Transactions Matter?
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.
We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But equally, we would consider it foolish to ignore insider transactions altogether. As Peter Lynch said, ‘insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.’
Veoneer Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when Chairman Jan Carlson bought US$2.5m worth of shares at a price of US$50.65 per share. That means that even when the share price was higher, an insider wanted to purchase shares. Their view may have changed since then, but at least it shows they felt optimistic at the time. It’s not at all bad to see insiders buy shares at or above current prices.
In the last twelve months insiders paid US$2.7m for 53.73k shares purchased. In the last twelve months there was more buying than selling by Veoneer insiders. They paid about US$50.89 on average. This is nice to see since it implies that insiders might see value around current prices (around US$30.00). You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
Insiders at Veoneer Have Bought Stock Recently
It’s good to see that Veoneer insiders have made notable investments in the company’s shares. Jan Carlson spent US$2.5m on stock, and there wasn’t any selling. This is a positive in our book as it implies some confidence.
Many investors like to check how much of a company is owned by 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. From our data, it seems that Veoneer insiders own 0.2% of the company, worth about US$5.7m. Whilst better than nothing, we’re not overly impressed by these holdings.
What Might The Insider Transactions At Veoneer Tell Us?
It’s certainly positive to see the recent insider purchase. 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. On this analysis the only slight negative we see is the fairly low (overall) insider ownership; their transactions suggest that they are quite positive on Veoneer stock. Of course, the future is what matters most. So if you are interested in Veoneer, you should check out this free report on analyst forecasts for the company.
Of course Veoneer may not be the best stock to buy. So you may wish to see this free collection of high quality companies.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at email@example.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned. Thank you for reading.