Need To Know: Omnicell, Inc. (NASDAQ:OMCL) Insiders Have Been Selling Shares
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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 we’ll take a look at whether insiders have been buying or selling shares in Omnicell, Inc. (NASDAQ:OMCL).
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 don’t think shareholders should simply follow insider transactions. But equally, we would consider it foolish to ignore insider transactions altogether. 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’.
Check out our latest analysis for Omnicell
Omnicell Insider Transactions Over The Last Year
Executive VP of Marketing Nhat Ngo 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$55.00 each. That means that even when the share price was below the current price of US$76.80, an insider wanted to cash in some shares. While their view may have changed since they sold, this isn’t a particularly bullish sign. When an insider sells below the current price, it does tend to make us wonder about the current valuation. We note that the biggest single sale was only 35.4% of Nhat Ngo’s holding.
Over the last year, we note insiders sold 26.78k shares worth US$1.4m. In total, Omnicell insiders sold more than they bought over the last year. The sellers received a price of around US$53.77, on average. We don’t gain much confidence from insider selling near the recent share price. Since insiders sell for many reasons, we wouldn’t put too much weight on it. You can see the insider transactions (by individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
If you like to buy stocks alongside management, then you might just love this free list of companies. (Hint: insiders have been buying them).
Insider Ownership of Omnicell
I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. Insiders own 2.8% of Omnicell shares, worth about US$84m. While this is a strong but not outstanding level of insider ownership, it’s enough to indicate some alignment between management and smaller shareholders.
What Might The Insider Transactions At Omnicell Tell Us?
The fact that there have been no Omnicell insider transactions recently certainly doesn’t bother us. We don’t take much encouragement from the transactions by Omnicell insiders. The modest level of insider ownership is, at least, some comfort. Of course, the future is what matters most. So if you are interested in Omnicell, 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 editorial-team@simplywallst.com.
