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Even if it's not a huge purchase, we think it was good to see that Jeffrey Stafeil, the Executive VP & CFO of Adient plc (NYSE:ADNT) recently shelled out US$100k to buy stock, at US$17.07 per share. Even though that isn't a massive buy, it did increase their holding by 54%, which is a arguably a good sign.
The Last 12 Months Of Insider Transactions At Adient
In fact, the recent purchase by Jeffrey Stafeil was the biggest purchase of Adient 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$13.24. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company's future. To us, it's very important to consider the price insiders pay for shares is very important. As a general rule, we feel more positive about a stock when an insider has bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price. Jeffrey Stafeil was the only individual insider to buy over the year.
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!
Adient is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Does Adient 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. We usually like to see fairly high levels of insider ownership. From looking at our data, insiders own US$4.2m worth of Adient stock, about 0.3% of the company. We prefer to see high levels of insider ownership.
So What Do The Adient Insider Transactions Indicate?
It is good to see the recent insider purchase. And the longer term insider transactions also give us confidence. But we don't feel the same about the fact the company is making losses. We would certainly prefer see higher levels of insider ownership but analysis of the insider transactions suggests that Adient insiders are expecting a bright future. 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. In terms of investment risks, we've identified 1 warning sign with Adient and understanding this 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.
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.
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