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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. On the other hand, we'd be remiss not to mention that insider sales have been known to precede tough periods for a business. So shareholders might well want to know whether insiders have been buying or selling shares in Artisan Partners Asset Management Inc. (NYSE:APAM).
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 logic dictates you should pay some attention to whether insiders are buying or selling shares. For example, a Harvard University study found that 'insider purchases earn abnormal returns of more than 6% per year'.
The Last 12 Months Of Insider Transactions At Artisan Partners Asset Management
In the last twelve months, the biggest single purchase by an insider was when Independent Director Tench Coxe bought US$3.2m worth of shares at a price of US$22.09 per share. We do like to see buying, but this purchase was made at well below the current price of US$48.51. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.
You can see the insider transactions (by companies and 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!
Artisan Partners Asset Management 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.
Insiders at Artisan Partners Asset Management Have Sold Stock Recently
Over the last three months, we've seen significant insider selling at Artisan Partners Asset Management. In total, Executive VP & COO of Investments Jason Gottlieb sold US$415k worth of shares in that time, and we didn't record any purchases whatsoever. Overall this makes us a bit cautious, but it's not the be all and end all.
For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Artisan Partners Asset Management insiders own about US$132m worth of shares (which is 3.5% of the company). Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
So What Do The Artisan Partners Asset Management Insider Transactions Indicate?
An insider hasn't bought Artisan Partners Asset Management stock in the last three months, but there was some selling. But we take heart from prior transactions. And insider ownership remains quite considerable. So the recent selling doesn't worry us. While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. Be aware that Artisan Partners Asset Management is showing 4 warning signs in our investment analysis, and 1 of those is concerning...
But note: Artisan Partners Asset Management 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.
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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