Investors who take an interest in Graham Holdings Company (NYSE:GHC) should definitely note that the Executive Vice President, Andrew Rosen, recently paid US$288 per share to buy US$500k worth of the stock. While that's a very decent purchase to our minds, it was proportionally a bit modest, boosting their holding by just 6.8%.
Graham Holdings Insider Transactions Over The Last Year
In fact, the recent purchase by Andrew Rosen was the biggest purchase of Graham Holdings shares made by an insider individual in the last twelve months, according to our records. That implies that an insider found the current price of US$309 per share to be enticing. That means they have been optimistic about the company in the past, though they may have changed their mind. While we always like to see insider buying, it's less meaningful if the purchases were made at much lower prices, as the opportunity they saw may have passed. The good news for Graham Holdings share holders is that insiders were buying at near the current price.
In the last twelve months Graham Holdings insiders were buying shares, but not selling. They paid about US$329 on average. These transactions suggest that insiders have considered the current price attractive. You can see the insider transactions (by individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
Does Graham Holdings Boast High Insider Ownership?
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. I reckon it's a good sign if insiders own a significant number of shares in the company. Graham Holdings insiders own 14% of the company, currently worth about US$229m 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 Do The Graham Holdings Insider Transactions Indicate?
It is good to see recent purchasing. We also take confidence from the longer term picture of insider transactions. Once you factor in the high insider ownership, it certainly seems like insiders are positive about Graham Holdings. Looks promising! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. In terms of investment risks, we've identified 2 warning signs with Graham Holdings and understanding them should be part of your investment process.
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.
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.
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