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Flux Power Holdings, Inc. (NASDAQ:FLUX) Insiders Increased Their Holdings

It is not uncommon to see companies perform well in the years after insiders buy shares. 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 shareholders might well want to know whether insiders have been buying or selling shares in Flux Power Holdings, Inc. (NASDAQ:FLUX).

What Is Insider Buying?

Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock in the company. 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 equally, we would consider it foolish to ignore insider transactions altogether. 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 Flux Power Holdings

The Last 12 Months Of Insider Transactions At Flux Power Holdings

The Independent Director John Cosentino made the biggest insider purchase in the last 12 months. That single transaction was for US$250k worth of shares at a price of US$4.00 each. Even though the purchase was made at a significantly lower price than the recent price (US$11.57), we still think insider buying is a positive. 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.

Over the last year, we can see that insiders have bought 103.13k shares worth US$413k. But insiders sold 13.83k shares worth US$220k. Overall, Flux Power Holdings insiders were net buyers during the last year. 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

Flux Power Holdings is not the only stock that insiders are buying. For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

Insiders at Flux Power Holdings Have Sold Stock Recently

Over the last three months, we've seen significant insider selling at Flux Power Holdings. In total, Independent Director John Cosentino sold US$220k worth of shares in that time, and we didn't record any purchases whatsoever. In light of this it's hard to argue that all the insiders think that the shares are a bargain.

Insider Ownership

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. A high insider ownership often makes company leadership more mindful of shareholder interests. From looking at our data, insiders own US$1.1m worth of Flux Power Holdings stock, about 0.7% of the company. We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. We prefer to see high levels of insider ownership.

So What Do The Flux Power Holdings Insider Transactions Indicate?

An insider sold Flux Power Holdings shares recently, but they didn't buy any. But we take heart from prior transactions. Still, insiders don't own a great deal of the stock. So the company doesn't look great on this analysis. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. For instance, we've identified 5 warning signs for Flux Power Holdings (2 can't be ignored) you should be aware of.

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.

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. 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.

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