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We often see insiders buying up shares in companies that perform well over the long term. 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 EnerSys (NYSE:ENS).
What Is Insider Buying?
It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, most countries require that the company discloses such transactions to the market.
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 EnerSys
In the last twelve months, the biggest single sale by an insider was when the COO & Executive VP, Todd Sechrist, sold US$1.7m worth of shares at a price of US$70.58 per share. That means that an insider was selling shares at around the current price of US$61.76. While we don't usually like to see insider selling, it's more concerning if the sales take price at a lower price. Given that the sale took place at around current prices, it makes us a little cautious but is hardly a major concern.
In the last twelve months insiders netted US$2.8m for 38054 shares sold. In the last year EnerSys insiders didn't buy any company stock. The chart below shows insider transactions (by individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!
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 EnerSys
I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. It appears that EnerSys insiders own 1.1% of the company, worth about US$29m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
So What Does This Data Suggest About EnerSys Insiders?
There haven't been any insider transactions in the last three months -- that doesn't mean much. Still, the insider transactions at EnerSys in the last 12 months are not very heartening. But it's good to see that insiders own shares in the company. Of course, the future is what matters most. So if you are interested in EnerSys, you should check out this free report on analyst forecasts for the company.
If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity and low debt.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at email@example.com. 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.