How Much Are Tactile Systems Technology, Inc. (NASDAQ:TCMD) Insiders Taking Off The Table?
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 Tactile Systems Technology, Inc. (NASDAQ:TCMD).
Do Insider Transactions Matter?
It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, rules govern insider transactions, and certain disclosures are required.
We don’t think shareholders should simply follow insider transactions. But logic dictates you should pay some attention to whether insiders are buying or selling shares. For example, a Colombia 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’.
See our latest analysis for Tactile Systems Technology
The Last 12 Months Of Insider Transactions At Tactile Systems Technology
In the last twelve months, the biggest single sale by an insider was when Director Kevin Roche sold US$926k worth of shares at a price of US$30.87 per share. That means that even when the share price was below the current price of US$45.06, an insider wanted to cash in some shares. Even though it doesn’t necessarily mean anything, that’s certainly not a positive sign, in our book. 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 27.4% of Kevin Roche’s holding.
Over the last year we saw more insider selling of Tactile Systems Technology shares, than buying. The average sell price was around US$45.15. It’s not ideal to see that insiders have sold at around the current price. While some insiders have decided to take some money off the table, we wouldn’t put too much weight on this fact. You can see the insider transactions over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!
There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of growing companies that insiders are buying.
Insiders at Tactile Systems Technology Have Bought Stock Recently
There was some insider buying at Tactile Systems Technology over the last quarter. Chief Financial Officer Brent Moen shelled out US$49k for shares in that time. It’s good to see the insider buying, as well as the lack of recent sellers. However, in this case the amount invested recently is quite small.
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. Tactile Systems Technology insiders own 3.5% of the company, currently worth about US$29m based on the recent share price. 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 Tactile Systems Technology Tell Us?
Insider purchases have outweighed sales, in the last three months. But the net investment is not enough to encourage us much. The insider transactions at Tactile Systems Technology are not very heartening. The modest level of insider ownership is, at least, some comfort. Therefore, you should should definitely take a look at this FREE report showing analyst forecasts for Tactile Systems Technology.
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.
