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Are Insiders Buying CARBO Ceramics Inc. (NYSE:CRR) Stock?

Simply Wall St

We often see insiders buying up shares in companies that perform well over the long term. On the other hand, we'd be remiss not to mention that insider sales have been known to precede tough periods for a business. So shareholders might well want to know whether insiders have been buying or selling shares in CARBO Ceramics Inc. (NYSE:CRR).

What Is Insider Selling?

It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, rules govern insider transactions, and certain disclosures are required.

We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But logic dictates you should pay some attention to whether insiders are buying or selling shares. For example, a Columbia University study found that 'insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers'.

See our latest analysis for CARBO Ceramics

The Last 12 Months Of Insider Transactions At CARBO Ceramics

In the last twelve months, the biggest single purchase by an insider was when Vice President of Marketing & Sales Don Conkle bought US$98k worth of shares at a price of US$1.31 per share. We do like to see buying, but this purchase was made at well below the current price of US$1.88. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.

In the last twelve months CARBO Ceramics insiders were buying shares, but not selling. You can see a visual depiction of insider transactions (by 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!

NYSE:CRR Recent Insider Trading, October 13th 2019

CARBO Ceramics is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Insiders at CARBO Ceramics Have Bought Stock Recently

Over the last quarter, CARBO Ceramics insiders have spent a meaningful amount on shares. Overall, three insiders shelled out US$226k for shares in the company -- and none sold. This could be interpreted as suggesting a positive outlook.

Insider Ownership of CARBO Ceramics

Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. CARBO Ceramics insiders own about US$11m worth of shares. That equates to 21% of the company. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Do The CARBO Ceramics Insider Transactions Indicate?

It's certainly positive to see the recent insider purchases. And the longer term insider transactions also give us confidence. But on the other hand, the company made a loss last year, which makes us a little cautious. Insiders likely see value in CARBO Ceramics shares, given these transactions (along with notable insider ownership of the company). If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.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. Thank you for reading.