We often see insiders buying up shares in companies that perform well over the long term. 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 we'll take a look at whether insiders have been buying or selling shares in Texas Pacific Land Trust (NYSE:TPL).
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 on the market. 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 equally, we would consider it foolish to ignore insider transactions altogether. 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.'
Texas Pacific Land Trust Insider Transactions Over The Last Year
The , Maurice Meyer, made the biggest insider sale in the last 12 months. That single transaction was for US$861k worth of shares at a price of US$864 each. So it's clear an insider wanted to take some cash off the table, even below the current price of US$882. When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent valuation. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. We note that the biggest single sale was only 1.3% of Maurice Meyer's holding. The only individual insider seller over the last year was Maurice Meyer.
In the last twelve months insiders purchased 400 shares for US$246k. But they sold 4109 for US$3.1m. Maurice Meyer divested 4109 shares over the last 12 months at an average price of US$756. 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!
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Insider Ownership of Texas Pacific Land Trust
Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. It appears that Texas Pacific Land Trust insiders own 0.2% of the company, worth about US$16m. 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 Texas Pacific Land Trust Insider Transactions Indicate?
The fact that there have been no Texas Pacific Land Trust insider transactions recently certainly doesn't bother us. We don't take much encouragement from the transactions by Texas Pacific Land Trust insiders. But we do like the fact that insiders own a fair chunk of the company. Along with insider transactions, I recommend checking if Texas Pacific Land Trust is growing revenue. This free chart of historic revenue and earnings should make that easy.
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.
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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.