Should You Take Comfort From Insider Transactions At Abercrombie & Fitch Co. (NYSE:ANF)?
We often see insiders buying up shares in companies that perform well over the long term. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So we'll take a look at whether insiders have been buying or selling shares in Abercrombie & Fitch Co. (NYSE:ANF).
What Is Insider Buying?
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock in the company. However, rules govern insider transactions, and certain disclosures are required.
We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But it is perfectly logical to keep tabs on what insiders are doing. 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'.
See our latest analysis for Abercrombie & Fitch
Abercrombie & Fitch Insider Transactions Over The Last Year
In the last twelve months, the biggest single sale by an insider was when the Independent Director, Charles Perrin, sold US$453k worth of shares at a price of US$22.66 per share. That means that an insider was selling shares at slightly below the current price (US$26.34). When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. This single sale was just 33% of Charles Perrin's stake. Charles Perrin was the only individual insider to sell shares in the last twelve months.
Happily, we note that in the last year insiders paid US$533k for 49.00k shares. On the other hand they divested 20.00k shares, for US$453k. Overall, Abercrombie & Fitch insiders were net buyers during the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!
Abercrombie & Fitch 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.
Abercrombie & Fitch Insiders Are Selling The Stock
The last quarter saw substantial insider selling of Abercrombie & Fitch shares. In total, Independent Director Charles Perrin sold US$453k worth of shares in that time, and we didn't record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.
Insider Ownership of Abercrombie & Fitch
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 2.1% of Abercrombie & Fitch shares, worth about US$34m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
What Might The Insider Transactions At Abercrombie & Fitch Tell Us?
An insider hasn't bought Abercrombie & Fitch stock in the last three months, but there was some selling. But we take heart from prior transactions. We like that insiders own a fair amount of the company. So we're not overly bothered by recent selling. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Abercrombie & Fitch. To that end, you should learn about the 3 warning signs we've spotted with Abercrombie & Fitch (including 1 which is a bit unpleasant).
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.
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. 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.
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