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Insiders who bought US$154k worth of Heritage Insurance Holdings, Inc.'s (NYSE:HRTG) stock at an average buy price of US$6.05 over the last year may be disappointed by the recent 17% decrease in the stock. Insiders invest with the hopes of seeing their money grow in value over time. However, as a result of recent losses, their initial investment is now only worth US$84k, which is not what they expected.
While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.
Heritage Insurance Holdings Insider Transactions Over The Last Year
The Chairman Richard Widdicombe made the biggest insider purchase in the last 12 months. That single transaction was for US$58k worth of shares at a price of US$5.84 each. So it's clear an insider wanted to buy, even at a higher price than the current share price (being US$3.32). It's very possible they regret the purchase, but it's more likely they are bullish about the company. In our view, the price an insider pays for shares is very important. As a general rule, we feel more positive about a stock if insiders have bought shares at above current prices, because that suggests they viewed the stock as good value, even at a higher price.
Heritage Insurance Holdings insiders may have bought shares in the last year, but they didn't sell any. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
Insider Ownership of Heritage Insurance Holdings
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. I reckon it's a good sign if insiders own a significant number of shares in the company. Insiders own 11% of Heritage Insurance Holdings shares, worth about US$9.5m, according to our data. Whilst better than nothing, we're not overly impressed by these holdings.
So What Do The Heritage Insurance Holdings Insider Transactions Indicate?
It doesn't really mean much that no insider has traded Heritage Insurance Holdings shares in the last quarter. However, our analysis of transactions over the last year is heartening. The transactions are fine but it'd be more encouraging if Heritage Insurance Holdings insiders bought more shares in the company. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Every company has risks, and we've spotted 3 warning signs for Heritage Insurance Holdings you should know about.
Of course Heritage Insurance Holdings may not be the best stock to buy. So you may wish to see this free collection of high quality 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.
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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.