Whilst it may not be a huge deal, we thought it was good to see that the Gulf Island Fabrication, Inc. (NASDAQ:GIFI) Independent Director, Robert Averick, recently bought US$68k worth of stock, for US$4.99 per share. However, we do note that it only increased their holding by 0.8%, and it wasn't a huge purchase by absolute value, either.
Gulf Island Fabrication Insider Transactions Over The Last Year
In fact, the recent purchase by Robert Averick was the biggest purchase of Gulf Island Fabrication 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$5.17 per share to be enticing. 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. 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. Happily, the Gulf Island Fabrication insiders decided to buy shares at close to current prices.
In the last twelve months Gulf Island Fabrication insiders were buying shares, but not selling. The chart below shows insider transactions (by individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
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.
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. Gulf Island Fabrication insiders own about US$15m worth of shares. That equates to 19% of the company. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
What Might The Insider Transactions At Gulf Island Fabrication Tell Us?
The recent insider purchases are heartening. And an analysis of the transactions over the last year also gives us confidence. But we don't feel the same about the fact the company is making losses. Given that insiders also own a fair bit of Gulf Island Fabrication we think they are probably pretty confident of a bright future. To put this in context, take a look at how a company has performed in the past. You can access this detailed graph of past earnings, revenue and cash flow.
But note: Gulf Island Fabrication 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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