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We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So before you buy or sell U.S. Xpress Enterprises, Inc. (NYSE:USX), you may well want to know whether insiders have been buying or selling.
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, most countries require that the company discloses such transactions to the market.
We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But it is perfectly logical to keep tabs on what insiders are doing. As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.
The Last 12 Months Of Insider Transactions At U.S. Xpress Enterprises
Over the last year, we can see that the biggest insider purchase was by Co-Founder & Executive Chairman Max Fuller for US$309k worth of shares, at about US$4.30 per share. That implies that an insider found the current price of US$5.07 per share to be enticing. That means they have been optimistic about the company in the past, though they may have changed their mind. We do always like to see insider buying, but it is worth noting if those purchases were made at well below today's share price, as the discount to value may have narrowed with the rising price. Happily, the U.S. Xpress Enterprises insiders decided to buy shares at close to current prices.
In the last twelve months U.S. Xpress Enterprises insiders were buying shares, but not selling. You can see the insider transactions (by individuals) 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!
U.S. Xpress Enterprises is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.
U.S. Xpress Enterprises Insiders Bought Stock Recently
It's good to see that U.S. Xpress Enterprises insiders have made notable investments in the company's shares. Not only was there no selling that we can see, but they collectively bought US$257k worth of shares. This is a positive in our book as it implies some confidence.
Does U.S. Xpress Enterprises Boast High Insider Ownership?
For a common shareholder, it is worth checking how many shares are held by company insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. U.S. Xpress Enterprises insiders own 54% of the company, currently worth about US$134m based on the recent share price. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.
So What Do The U.S. Xpress Enterprises Insider Transactions Indicate?
The recent insider purchases are heartening. And an analysis of the transactions over the last year also gives us confidence. Once you factor in the high insider ownership, it certainly seems like insiders are positive about U.S. Xpress Enterprises. One for the watchlist, at least! If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.
But note: U.S. Xpress Enterprises 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.
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.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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.
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