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We often see insiders buying up shares in companies that perform well over the long term. 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 Cracker Barrel Old Country Store, Inc. (NASDAQ:CBRL), you may well want to know whether insiders have been buying or selling.
What Is Insider Buying?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a 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 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 Cracker Barrel Old Country Store
In the last twelve months, the biggest single sale by an insider was when the , Nicholas Flanagan, sold US$728k worth of shares at a price of US$146 per share. That means that even when the share price was below the current price of US$170, an insider wanted to cash in some shares. We generally consider it a negative if insiders have been selling on market, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. It is worth noting that this sale was only 29.2% of Nicholas Flanagan's holding.
Over the last year, we note insiders sold 7731 shares worth US$1.1m. In the last year Cracker Barrel Old Country Store insiders didn't buy any company stock. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
I will like Cracker Barrel Old Country Store better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.
Does Cracker Barrel Old Country Store Boast High Insider Ownership?
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 1.0% of Cracker Barrel Old Country Store shares, worth about US$42m. 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 Cracker Barrel Old Country Store Tell Us?
It doesn't really mean much that no insider has traded Cracker Barrel Old Country Store shares in the last quarter. Still, the insider transactions at Cracker Barrel Old Country Store in the last 12 months are not very heartening. But it's good to see that insiders own shares in the company. Therefore, you should should definitely take a look at this FREE report showing analyst forecasts for Cracker Barrel Old Country Store.
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.
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If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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.