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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 shareholders might well want to know whether insiders have been buying or selling shares in The Greenbrier Companies, Inc. (NYSE:GBX).
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 on the market. However, rules govern insider transactions, and certain disclosures are required.
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. 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 Greenbrier Companies
The Executive Vice President of Sales & Marketing, Brian Comstock, made the biggest insider sale in the last 12 months. That single transaction was for US$290k worth of shares at a price of US$58.06 each. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. The silver lining is that this sell-down took place above the latest price (US$27.21). So it may not shed much light on insider confidence at current levels.
We note that in the last year insiders divested 10300 shares for a total of US$542k. In the last year Greenbrier Companies insiders didn't buy any company stock. The chart below shows insider transactions (by individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!
I will like Greenbrier Companies better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.
Insiders at Greenbrier Companies Have Sold Stock Recently
Over the last three months, we've seen significant insider selling at Greenbrier Companies. Specifically, Chief Compliance Officer Martin Baker ditched US$71k worth of shares in that time, and we didn't record any purchases whatsoever. In light of this it's hard to argue that all the insiders think that the shares are a bargain.
Does Greenbrier Companies Boast High Insider Ownership?
Many investors like to check how much of a company is owned by insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Greenbrier Companies insiders own about US$16m worth of shares. That equates to 1.8% 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.
So What Do The Greenbrier Companies Insider Transactions Indicate?
An insider sold stock recently, but they haven't been buying. And even if we look to the last year, we didn't see any purchases. While insiders do own shares, they don't own a heap, and they have been selling. We're in no rush to buy! Therefore, you should should definitely take a look at this FREE report showing analyst forecasts for Greenbrier Companies.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.
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 email@example.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. Thank you for reading.