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We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. 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 before you buy or sell Immersion Corporation (NASDAQ:IMMR), you may well want to know whether insiders have been buying or selling.
What Is Insider Buying?
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock in the company. However, such insiders must disclose their trading activities, and not trade on inside information.
We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But equally, we would consider it foolish to ignore insider transactions altogether. As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise'.
The Last 12 Months Of Insider Transactions At Immersion
The President, Ramzi Haidamus, made the biggest insider sale in the last 12 months. That single transaction was for US$83k worth of shares at a price of US$8.29 each. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. The silver lining is that this sell-down took place above the latest price (US$6.77). So it may not tell us anything about how insiders feel about the current share price. Ramzi Haidamus was the only individual insider to sell shares in the last twelve months.
In the last twelve months insiders purchased 23.88k shares for US$161k. But insiders sold 10.00k shares worth US$83k. In total, Immersion insiders bought more than they sold over the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
Immersion is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
Immersion Insiders Are Selling The Stock
The last three months saw significant insider selling at Immersion. In total, President Ramzi Haidamus sold US$83k worth of shares in that time, and we didn't record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.
Insider Ownership of Immersion
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. From looking at our data, insiders own US$3.9m worth of Immersion stock, about 2.1% of the company. I generally like to see higher levels of ownership.
So What Do The Immersion Insider Transactions Indicate?
An insider sold Immersion shares recently, but they didn't buy any. On the other hand, the insider transactions over the last year are encouraging. But we'd like it if insiders owned more stock, overall. So we can't be sure that insiders are optimistic. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Immersion. Every company has risks, and we've spotted 2 warning signs for Immersion you should know about.
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.
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. 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.
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