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 before you buy or sell Spirit MTA REIT (NYSE:SMTA), you may well want to know whether insiders have been buying or selling.
What Is Insider Selling?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, most countries require that the company discloses such transactions to the market.
We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But it is perfectly logical to keep tabs on what insiders are doing. 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 Spirit MTA REIT
Over the last year, we can see that the biggest insider sale was by the Chairman, Jackson Hsieh, for US$583k worth of shares, at about US$9.45 per share. While we don't usually like to see insider selling, it's more concerning if the sales take price at a lower price. The silver lining is that this sell-down took place above the latest price (US$6.69). So it is hard to draw any strong conclusion from it. Jackson Hsieh was the only individual insider to sell shares in the last twelve months.
You can see the insider transactions (by 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!
For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.
For a common shareholder, it is worth checking how many shares are held by company 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. From looking at our data, insiders own US$2.3m worth of Spirit MTA REIT stock, about 0.8% of the company. We consider this fairly low insider ownership.
What Might The Insider Transactions At Spirit MTA REIT Tell Us?
It doesn't really mean much that no insider has traded Spirit MTA REIT shares in the last quarter. We don't take much encouragement from the transactions by Spirit MTA REIT insiders. We also note that, as far as we can see, insider ownership is fairly low, compared to other companies. I like to dive deeper into how a company has performed in the past. You can access this interactive graph of past earnings, revenue and cash flow for free .
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 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.