Are Insiders Selling Fastenal Company (NASDAQ:FAST) Stock?
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It is not uncommon to see companies perform well in the years after insiders buy shares. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So we’ll take a look at whether insiders have been buying or selling shares in Fastenal Company (NASDAQ:FAST).
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.
Insider transactions are not the most important thing when it comes to long-term investing. But logic dictates you should pay some attention to whether insiders are buying or selling shares. For example, a Harvard University study found that ‘insider purchases earn abnormal returns of more than 6% per year.’
See our latest analysis for Fastenal
The Last 12 Months Of Insider Transactions At Fastenal
In the last twelve months, the biggest single sale by an insider was when Senior Executive Vice President of Operations Nicholas Lundquist sold US$303k worth of shares at a price of US$60.51 per share. That means that an insider was selling shares at slightly below the current price (US$62.97). Even though it doesn’t necessarily mean anything, that’s certainly not a positive sign, in our book. We generally consider it a negative if insiders have been selling on market, especially if they did so below the current price. It is worth noting that this sale was only 1.9% of Nicholas Lundquist’s holding.
Happily, we note that in the last year insiders paid US$511k for 9.95k shares. But insiders sold 12.50k shares worth US$753k. In total, Fastenal insiders sold more than they bought over the last year. The average sell price was around US$60.20. It’s not particularly great to see insiders were selling shares at below recent prices. Of course, the sales could be motivated for a multitude of reasons, so we shouldn’t jump to conclusions. The chart below shows insider transactions (by individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.
Insiders at Fastenal Have Sold Stock Recently
The last three months saw significant insider selling at Fastenal. In total, insiders sold US$753k 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 Fastenal
I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. We usually like to see fairly high levels of insider ownership. Fastenal insiders own about US$66m worth of shares. That equates to 0.4% of the company. While this is a strong but not outstanding level of insider ownership, it’s enough to indicate some alignment between management and smaller shareholders.
What Might The Insider Transactions At Fastenal Tell Us?
Insiders haven’t bought Fastenal stock in the last three months, but there was some selling. And our longer term analysis of insider transactions didn’t bring confidence, either. But it is good to see that Fastenal is growing earnings. Insiders own shares, but we’re still pretty cautious, given the history of sales. We’d think twice before buying! Therefore, you should should definitely take a look at this FREE report showing analyst forecasts for Fastenal.
If you would prefer to check out another company — one with potentially superior financials — then do not miss this free list of interesting companies, that have HIGH return on equity 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 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. On rare occasion, data errors may occur. Thank you for reading.
