HCA Healthcare, Inc. (NYSE:HCA) insiders' US$19m purchase saw a boost of US$964k after market cap rose US$2.8b
HCA Healthcare, Inc. (NYSE:HCA) insiders who bought shares over the past year were rewarded handsomely last week. The stock rose 4.6%, resulting in a US$2.8b rise in the company's market capitalisation. As a result, the stock they originally bought for US$19m is now worth US$20m.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, we do think it is perfectly logical to keep tabs on what insiders are doing.
View our latest analysis for HCA Healthcare
HCA Healthcare Insider Transactions Over The Last Year
Over the last year, we can see that the biggest insider purchase was by Founder & Chairman Emeritus Thomas Frist for US$19m worth of shares, at about US$215 per share. That means that an insider was happy to buy shares at around the current price of US$223. Of course they may have changed their mind. But this suggests they are optimistic. If someone buys shares at well below current prices, it's a good sign on balance, but keep in mind they may no longer see value. The good news for HCA Healthcare share holders is that insiders were buying at near the current price.
In the last twelve months insiders purchased 91.70k shares for US$19m. But insiders sold 49.56k shares worth US$12m. In the last twelve months there was more buying than selling by HCA Healthcare insiders. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
HCA Healthcare 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.
HCA Healthcare Insiders Are Selling The Stock
The last quarter saw substantial insider selling of HCA Healthcare shares. In total, insiders sold US$3.7m 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.
Does HCA Healthcare 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. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It's great to see that HCA Healthcare insiders own 1.3% of the company, worth about US$826m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.
What Might The Insider Transactions At HCA Healthcare Tell Us?
Insiders haven't bought HCA Healthcare stock in the last three months, but there was some selling. But we take heart from prior transactions. And insider ownership remains quite considerable. So the recent selling doesn't worry us. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing HCA Healthcare. To that end, you should learn about the 3 warning signs we've spotted with HCA Healthcare (including 1 which is concerning).
But note: HCA Healthcare 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.
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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.
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