It is not uncommon to see companies perform well in the years after insiders buy shares. 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 Townsquare Media, Inc. (NYSE:TSQ).
Do Insider Transactions Matter?
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.
Insider transactions are not the most important thing when it comes to long-term investing. 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.’
Townsquare Media Insider Transactions Over The Last Year
In the last twelve months, the biggest single purchase by an insider was when Director Stephen Kaplan bought US$64k worth of shares at a price of US$6.40 per share. That means that even when the share price was higher, an insider wanted to purchase shares. It’s very possible they regret the purchase, but it’s more likely they are bullish about the company. That purchase may suggest an expectation of positive returns over the long term.
In the last twelve months insiders paid US$165k for 25.50k shares purchased. In total, Townsquare Media insiders bought more than they sold over the last year. The average buy price was around US$6.49. This is nice to see since it implies that insiders might see value around current prices (around US$5.54). The chart below shows insider transactions over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!
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Townsquare Media Insiders Bought Stock Recently
Over the last quarter, Townsquare Media insiders have spent a meaningful amount on shares. Stephen Kaplan spent US$64k on stock, and there wasn’t any selling. This makes one think the business has some good points.
Does Townsquare Media Boast High Insider Ownership?
For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Townsquare Media insiders own 5.6% of the company, currently worth about US$5.4m based on the recent share price. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.
What Might The Insider Transactions At Townsquare Media Tell Us?
The recent insider purchase is heartening. We also take confidence from the longer term picture of insider transactions. However, we note that the company didn’t make a profit over the last twelve months, which makes us cautious. We would certainly prefer see higher levels of insider ownership but analysis of the insider transactions suggests that Townsquare Media insiders are expecting a bright future. Therefore, you should should definitely take a look at this FREE report showing analyst forecasts for Townsquare Media.
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To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at email@example.com.