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Designer Brands Inc. (NYSE:DBI) insiders have a reason to boast after seeing a US$1.1m addition to their US$8.8m investment

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Designer Brands Inc. (NYSE:DBI) insiders who bought shares over the past year were rewarded handsomely last week. The stock rose 11%, resulting in a US$111m rise in the company's market capitalisation. As a result, their original purchase of US$8.8m worth of stock is now worth US$9.9m.

While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.

See our latest analysis for Designer Brands

Designer Brands Insider Transactions Over The Last Year

The Executive Chairman Jay Schottenstein made the biggest insider purchase in the last 12 months. That single transaction was for US$8.8m worth of shares at a price of US$14.03 each. We do like to see buying, but this purchase was made at well below the current price of US$15.71. Because the shares were purchased at a lower price, this particular buy doesn't tell us much about how insiders feel about the current share price.

The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

insider-trading-volume
insider-trading-volume

Designer Brands is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Insider Ownership of Designer Brands

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. Designer Brands insiders own 15% of the company, currently worth about US$178m based on the recent share price. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Do The Designer Brands Insider Transactions Indicate?

It doesn't really mean much that no insider has traded Designer Brands shares in the last quarter. However, our analysis of transactions over the last year is heartening. With high insider ownership and encouraging transactions, it seems like Designer Brands insiders think the business has merit. 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. To assist with this, we've discovered 1 warning sign that you should run your eye over to get a better picture of Designer Brands.

But note: Designer Brands 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. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.