Insider Stock Buying Reaches US$625k On Forum Energy Technologies
It is usually uneventful when a single insider buys stock. However, When quite a few insiders buy shares, as it happened in Forum Energy Technologies, Inc.'s (NYSE:FET) case, it's fantastic news for shareholders.
Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.
Check out our latest analysis for Forum Energy Technologies
Forum Energy Technologies Insider Transactions Over The Last Year
The President Neal Lux made the biggest insider purchase in the last 12 months. That single transaction was for US$475k worth of shares at a price of US$21.60 each. Even though the purchase was made at a significantly lower price than the recent price (US$25.20), 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.
In the last twelve months insiders purchased 27.00k shares for US$625k. But they sold 400.00 shares for US$10k. In the last twelve months there was more buying than selling by Forum Energy Technologies insiders. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
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).
Insiders At Forum Energy Technologies Have Bought Stock Recently
Over the last three months, we've seen significant insider buying at Forum Energy Technologies. We can see that President Neal Lux paid US$475k for shares in the company. No-one sold. This could be interpreted as suggesting a positive outlook.
Does Forum Energy Technologies Boast High Insider Ownership?
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Insiders own 5.8% of Forum Energy Technologies shares, worth about US$15m. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.
So What Do The Forum Energy Technologies Insider Transactions Indicate?
It's certainly positive to see the recent insider purchase. 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 Forum Energy Technologies we think they are probably pretty confident of 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. To assist with this, we've discovered 1 warning sign that you should run your eye over to get a better picture of Forum Energy Technologies.
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.
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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.
