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It is not uncommon to see companies perform well in the years after insiders buy shares. On the other hand, we'd be remiss not to mention that insider sales have been known to precede tough periods for a business. So before you buy or sell STERIS plc (NYSE:STE), you may well want to know whether insiders have been buying or selling.
What Is Insider Selling?
It's quite normal to see company insiders, such as board members, trading in company stock, from time to time. However, such insiders must disclose their trading activities, and not trade on inside information.
Insider transactions are not the most important thing when it comes to long-term investing. But it is perfectly logical to keep tabs on what insiders are doing. As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.'
STERIS Insider Transactions Over The Last Year
The CEO & President, Walter Rosebrough, made the biggest insider sale in the last 12 months. That single transaction was for US$1.1m worth of shares at a price of US$103 each. So it's clear an insider wanted to take some cash off the table, even below the current price of US$125. As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. However, while insider selling is sometimes discouraging, it's only a weak signal. We note that the biggest single sale was only 10.4% of Walter Rosebrough's holding.
Over the last year, we note insiders sold 23068 shares worth US$2.4m. In the last year STERIS insiders didn't buy any company stock. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. 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.
Many investors like to check how much of a company is owned by insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. From our data, it seems that STERIS insiders own 0.05% of the company, worth about US$5.8m. Whilst better than nothing, we're not overly impressed by these holdings.
So What Do The STERIS Insider Transactions Indicate?
It doesn't really mean much that no insider has traded STERIS shares in the last quarter. The insider transactions at STERIS are not inspiring us to buy. We also note that, as far as we can see, insider ownership is fairly low, compared to other companies. If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.
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 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.