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 we’ll take a look at whether insiders have been buying or selling shares in Brown-Forman Corporation (NYSE:BF.B).
What Is Insider Buying?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, such insiders must disclose their trading activities, and not trade on inside information.
We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But equally, we would consider it foolish to ignore insider transactions altogether. For example, a Harvard University study found that ‘insider purchases earn abnormal returns of more than 6% per year.’
Brown-Forman Insider Transactions Over The Last Year
Executive VP Matthew Hamel made the biggest insider purchase in the last 12 months. That single transaction was for US$52k worth of shares at a price of US$52.54 each. So it’s clear an insider wanted to buy, even at a higher price. While their view may have changed since the purchase was made, this does at least suggest they have had confidence in the company’s future. It’s not at all bad to see insiders buy shares at or above current prices. Matthew Hamel was the only individual insider to buy over the year.
You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.
Have Brown-Forman Insiders Traded Recently?
The last three months saw some Brown-Forman insider selling. Michael Keyes sold just US$7.7k worth of shares in that time. It’s not great to see insider selling, nor the lack of recent buyers. But the volume sold is so low that it really doesn’t bother us.
Does Brown-Forman 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. A high insider ownership often makes company leadership more mindful of shareholder interests. Brown-Forman insiders own about US$939m worth of shares (which is 4.3% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.
What Might The Insider Transactions At Brown-Forman Tell Us?
Our data shows a little more insider selling than buying in the last three months. But the difference is small, and thus, not concerning. However, our analysis of transactions over the last year is heartening. With high insider ownership and encouraging transactions, it seems like Brown-Forman insiders think the business has merit. Of course, the future is what matters most. So if you are interested in Brown-Forman, you should check out this free report on analyst forecasts for the company.
Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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 email@example.com.