We’ve lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. 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 shareholders might well want to know whether insiders have been buying or selling shares in Utah Medical Products, Inc. (NASDAQ:UTMD).
Do Insider Transactions Matter?
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 would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But logic dictates you should pay some attention to whether insiders are buying or selling shares. For example, a Columbia University study found that ‘insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers’.
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Utah Medical Products Insider Transactions Over The Last Year
Chairman Kevin Cornwell made the biggest insider sale in the last 12 months. That single transaction was for US$865k worth of shares at a price of US$108 each. While the sale doesn’t make us feel confident, we do note it was conducted at a price well above the current share price, which is US$83.22. So it is hard to draw any strong conclusion from it.
Over the last year, we note insiders sold 52.18k shares worth US$5.2m. Over the last year we saw more insider selling of Utah Medical Products shares, than buying. They sold for an average price of about US$99.96. Insider selling doesn’t make us excited to buy. But we note that the selling, on average, was at well above the recently traded price of US$83.22. 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!
If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).
Utah Medical Products Insiders Are Selling The Stock
The last three months saw significant insider selling at Utah Medical Products. In total, Director Barbara Payne dumped US$103k worth of shares in that time, and we didn’t record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.
Does Utah Medical Products Boast High Insider Ownership?
Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Insiders own 7.4% of Utah Medical Products shares, worth about US$23m. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.
So What Does This Data Suggest About Utah Medical Products Insiders?
An insider hasn’t bought Utah Medical Products stock in the last three months, but there was some selling. Looking to the last twelve months, our data doesn’t show any insider buying. While insiders do own shares, they don’t own a heap, and they have been selling. So we’d only buy after careful consideration. I like to dive deeper into how a company has performed in the past. You can find historic revenue and earnings in this detailed graph.
But note: Utah Medical Products may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.
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.