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We often see insiders buying up shares in companies that perform well over the long term. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So we'll take a look at whether insiders have been buying or selling shares in Delphi Technologies PLC (NYSE:DLPH).
What Is Insider Buying?
It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, most countries require that the company discloses such transactions to the market.
We don't think shareholders should simply follow insider transactions. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Harvard University study found that 'insider purchases earn abnormal returns of more than 6% per year.'
The Last 12 Months Of Insider Transactions At Delphi Technologies
Over the last year, we can see that the biggest insider purchase was by Independent Director Joseph Cantie for US$149k worth of shares, at about US$16.61 per share. Even though the purchase was made at a significantly lower price than the recent price (US$22.46), we still think insider buying is a positive. 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.
Happily, we note that in the last year insiders bought 25500 shares for a total of US$490k. While Delphi Technologies insiders bought shares last year, they didn't sell. The average buy price was around US$19.22. These transactions show that insiders have confidence to invest their own money in the stock, albeit at slightly below the recent price. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Delphi Technologies is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Does Delphi Technologies Boast High Insider Ownership?
Many investors like to check how much of a company is owned by insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Based on our data, Delphi Technologies insiders have about 0.2% of the stock, worth approximately US$4.2m. I generally like to see higher levels of ownership.
What Might The Insider Transactions At Delphi Technologies Tell Us?
The fact that there have been no Delphi Technologies insider transactions recently certainly doesn't bother us. On a brighter note, the transactions over the last year are encouraging. The transactions are fine but it'd be more encouraging if Delphi Technologies insiders bought more shares in the company. Therefore, you should should definitely take a look at this FREE report showing analyst forecasts for Delphi Technologies.
But note: Delphi Technologies 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.
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 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. Thank you for reading.