We often see insiders buying up shares in companies that perform well over the long term. 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 TFS Financial Corporation (NASDAQ:TFSL).
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, rules govern insider transactions, and certain disclosures are required.
We don’t think shareholders should simply follow insider transactions. 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.’
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The Last 12 Months Of Insider Transactions At TFS Financial
In the last twelve months, the biggest single sale by an insider was when Secretary & Director Ben Stefanski sold US$402k worth of shares at a price of US$15.10 per share. That means that an insider was selling shares at slightly below the current price (US$16.77). While their view may have changed since they sold, this isn’t a particularly bullish sign. We generally consider it a negative if insiders have been selling on market, especially if they did so below the current price. Please note, however, that this single sale was just 35.3% of Ben Stefanski’s stake.
In the last twelve months insiders purchased 6.64k shares for US$100k. But insiders sold 35.80k shares worth US$542k. In total, TFS Financial insiders sold more than they bought over the last year. The sellers received a price of around US$15.14, on average. It’s not too encouraging to see that insiders have sold at below the current price. Of course, the sales could be motivated for a multitude of reasons, so we shouldn’t jump to conclusions. 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 TFS Financial 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 TFS Financial Boast High Insider Ownership?
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. Insiders own 0.5% of TFS Financial shares, worth about US$23m. 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 Does This Data Suggest About TFS Financial Insiders?
It doesn’t really mean much that no insider has traded TFS Financial shares in the last quarter. Our analysis of TFS Financial insider transactions leaves us cautious. The modest level of insider ownership is, at least, some comfort. 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 TFS Financial may not be the best stock to buy. So you may wish to see this free collection of high quality companies.
To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at firstname.lastname@example.org.