Potential TransDigm Group Incorporated (NYSE:TDG) shareholders may wish to note that the Independent Director, William Dries, recently bought US$425k worth of stock, paying US$425 for each share. That certainly has us anticipating the best, especially since they thusly increased their own holding by 76%, potentially signalling some real optimism.
The Last 12 Months Of Insider Transactions At TransDigm Group
In fact, the recent purchase by William Dries was the biggest purchase of TransDigm Group shares made by an insider individual in the last twelve months, according to our records. That means that an insider was happy to buy shares at above the current price of US$338. Their view may have changed since then, but at least it shows they felt optimistic at the time. In our view, the price an insider pays for shares is very important. It is generally more encouraging if they paid above the current price, as it suggests they saw value, even at higher levels.
While TransDigm Group insiders bought shares last year, they didn't sell. Their average price was about US$475. This is nice to see since it implies that insiders might see value around current prices. The chart below shows insider transactions (by individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).
Does TransDigm Group Boast High 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. We usually like to see fairly high levels of insider ownership. TransDigm Group insiders own 0.9% of the company, currently worth about US$161m 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 TransDigm Group Insider Transactions Indicate?
It's certainly positive to see the recent insider purchase. And the longer term insider transactions also give us confidence. Along with the high insider ownership, this analysis suggests that insiders are quite bullish about TransDigm Group. That's what I like to see! So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. At Simply Wall St, we've found that TransDigm Group has 4 warning signs (1 doesn't sit too well with us!) that deserve your attention before going any further with your analysis.
Of course TransDigm Group may not be the best stock to buy. So you may wish to see this free collection of high quality companies.
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.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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.
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