U.S. Markets closed

Should You Take Comfort From Insider Transactions At Hexcel Corporation (NYSE:HXL)?

Saundra Reilly

We’ve lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So shareholders might well want to know whether insiders have been buying or selling shares in Hexcel Corporation (NYSE:HXL).

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 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.’

Check out our latest analysis for Hexcel

Hexcel Insider Transactions Over The Last Year

Independent Director Jeffrey Graves made the biggest insider purchase in the last 12 months. That single transaction was for US$107k worth of shares at a price of US$69.00 each. That means that an insider was happy to buy shares at above the current 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. It’s not at all bad to see insiders buy shares at or above current prices. The only individual insider to buy over the last year was Jeffrey Graves.

Jeffrey Graves bought 3.00k shares over the last 12 months at an average price of US$69.54. The chart below shows insider transactions over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

NYSE:HXL Insider Trading December 21st 18

If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.

Insider Ownership of Hexcel

For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. Hexcel insiders own 0.8% of the company, currently worth about US$40m based on the recent share price. 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 Does This Data Suggest About Hexcel Insiders?

The fact that there have been no Hexcel insider transactions recently certainly doesn’t bother us. On a brighter note, the transactions over the last year are encouraging. Overall we don’t see anything to make us think Hexcel insiders are doubting the company, and they do own shares. Of course, the future is what matters most. So if you are interested in Hexcel, you should check out this free report on analyst forecasts for the company.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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 editorial-team@simplywallst.com.