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We often see insiders buying up shares in companies that perform well over the long term. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So shareholders might well want to know whether insiders have been buying or selling shares in Marten Transport, Ltd. (NASDAQ:MRTN).
What Is Insider Selling?
Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock in the company. However, such insiders must disclose their trading activities, and not trade on inside information.
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 Harvard University study found that 'insider purchases earn abnormal returns of more than 6% per year.
Marten Transport Insider Transactions Over The Last Year
The Chairman of the Board & CEO, Randolph Marten, made the biggest insider sale in the last 12 months. That single transaction was for US$1.7m worth of shares at a price of US$19.20 each. That means that even when the share price was below the current price of US$20.16, an insider wanted to cash in some shares. 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 0.8% of Randolph Marten's holding. The only individual insider seller over the last year was Randolph Marten.
Randolph Marten ditched 100000 shares over the year. The average price per share was US$18.97. 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 Marten Transport better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.
Insider Ownership of Marten Transport
For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. It's great to see that Marten Transport insiders own 29% of the company, worth about US$318m. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.
So What Do The Marten Transport Insider Transactions Indicate?
It doesn't really mean much that no insider has traded Marten Transport shares in the last quarter. While we feel good about high insider ownership of Marten Transport, we can't say the same about the selling of shares. Of course, the future is what matters most. So if you are interested in Marten Transport, you should check out this free report on analyst forecasts for the company.
Of course Marten Transport may not be the best stock to buy. So you may wish to see this free collection of high quality companies.
For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently account for open market transactions and private dispositions, but not derivative transactions.
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
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.