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 Malibu Boats, Inc. (NASDAQ:MBUU).
Do Insider Transactions Matter?
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, rules govern insider transactions, and certain disclosures are required.
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.'
Malibu Boats Insider Transactions Over The Last Year
In the last twelve months, the biggest single sale by an insider was when the CEO & Director, Jack Springer, sold US$1.2m worth of shares at a price of US$53.31 per share. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. The good news is that this large sale was at well above current price of US$28.06. So it may not tell us anything about how insiders feel about the current share price.
In the last twelve months insiders netted US$3.6m for 71025 shares sold. Malibu Boats insiders didn't buy any shares over the last year. 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!
I will like Malibu Boats better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.
Does Malibu Boats Boast High Insider Ownership?
Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. We usually like to see fairly high levels of insider ownership. Our data indicates that Malibu Boats insiders own about US$5.7m worth of shares (which is 0.9% of the company). Whilst better than nothing, we're not overly impressed by these holdings.
So What Do The Malibu Boats Insider Transactions Indicate?
It doesn't really mean much that no insider has traded Malibu Boats shares in the last quarter. We don't take much encouragement from the transactions by Malibu Boats insiders. We also note that, as far as we can see, insider ownership is fairly low, compared to other companies. Therefore, you should should definitely take a look at this FREE report showing analyst forecasts for Malibu Boats.
Of course Malibu Boats 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.
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 firstname.lastname@example.org. 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.